THE Philippine banking sector’s assets rose to record P30.44 trillion as of end-May, Bangko Sentral ng Pilipinas data showed, up 11.7 percent from the year-earlier P27.3 trillion.
Bank assets primarily consist of deposits, loans and investments, including cash, amounts due from other banks, interbank loans receivable (IBL) and reverse repurchase (RRP) arrangements, adjusted for allowances for credit losses.
Month on month, total assets also increased from April’s P30.12 trillion, which marked a dip from the previous record high of P30.33 trillion March.
Union Bank of the Philippines senior economist Ruben Carlo Asuncion said the expansion reflected “healthy growth in lending, sustained deposit inflows and higher investment holdings amid resilient domestic demand and supportive liquidity conditions.”
“The fact that banking system assets have surpassed the P30-trillion mark highlights the sector’s capacity to support economic activity through credit creation and financial intermediation, which remains essential for consumption, investment and business expansion,” he added.
The aggregate loan portfolio, inclusive of IBL and RRP, hit P16.95 trillion, higher than the year-earlier P15.12 trillion and month earlier’s P16.67 trillion.
Net investments, including financial assets and equity investments in subsidiaries, rose to P8.64 trillion from P7.96 trillion a year earlier but slightly lower than the P8.67 trillion a month earlier.
Cash and amounts due from banks, meanwhile, dropped to P2.21 trillion from P1.98 trillion and P2.2 trillion a year and month earlier.
The value of net real and other properties acquired grew to P143.8 billion from P121.06 billion in May 2025 and P142.98 billion in April 2026.
Other assets totaled P2.49 trillion, more than the P2.08 trillion recorded a year earlier.
The banking system’s total liabilities, meanwhile, rose to P26.85 trillion from P23.79 trillion in May 2025 and the month-earlier P26.49 trillion.
“We expect bank assets to continue growing, although the outlook has become more nuanced given the resurgence of hostilities in the Middle East,” Asuncion said.
“This development matters because a prolonged escalation could keep oil prices elevated, revive inflation pressures and introduce greater uncertainty into global financial markets,” he added.
Asuncion said these factors could weigh on consumer and business confidence, slowing borrowing and investment.
Still, he noted that liquidity remained ample, financing conditions were supportive and loan demand continued to hold up.
“Barring a more severe and sustained external shock, we still expect the banking sector’s balance sheet to expand in the months ahead, albeit with greater sensitivity to geopolitical developments and their implications for inflation and interest rates,” Asuncion said.
