By Katherine K. Chan, Reporter
THE PHILIPPINE financial system’s total resources rose to P37.45 trillion in the primary quarter of 2026 because the sector’s assets ballooned despite headwinds stemming from the Middle East war, preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed.
As of March, banks and nonbank financial institutions’ combined resources grew by 8.61% to P37.45 trillion from P34.481 trillion in the identical period last 12 months.
Month on month, it edged up by 1.38% from P36.941 trillion previously.
These include funds and assets akin to deposits, capital, and bonds or debt securities, but exclude resources from the central bank.
Banks alone held P31.103 trillion price of resources throughout the period, climbing by 9.19% from the P28.485 trillion seen a 12 months earlier.
Broken down, universal and business banks’ resources rose by 8.41% 12 months on 12 months to P28.871 trillion at end-March from P26.631 trillion previously. This was the majority of the sector’s resources in the primary quarter.
Resources of thrift banks also jumped by 25.17% to P1.478 trillion at end-March from P1.181 trillion within the comparable year-ago period, while digital banks had 44.82% more resources at end-March with P188.7 billion from P130.3 billion within the prior 12 months.
Meanwhile, resources held by rural and cooperative banks stood at P565 billion as of end-December last 12 months, 4.01% higher than the P543.2 billion seen in the primary quarter of 2025. There have been no data for rural and cooperative banks as of end-March this 12 months.
Union Bank of the Philippines Chief Economist Ruben Carlo O. Asuncion said the upper resources as of end-March got here as banks and nonbank financial institutions’ balance sheets remained sound amid the Middle East conflict, with lending activity and deposit inflows likewise boosting their holdings.
“The rise underscores the resilience of the domestic economic system, which stays well-positioned to intermediate funds despite external headwinds akin to the continued Middle East conflict,” he said in a Viber message.
Separate central bank data showed that lenders’ assets hit an all-time high of P30.336 trillion as of end-March, the primary full month of the Middle East war. This was up by 9.77% 12 months on 12 months from P27.644 trillion.
Banks’ loan growth likewise hit its fastest pace in seven months in March, as lending to businesses and consumers climbed 10.7% to P14.603 trillion from P13.192 trillion a 12 months ago.
Higher investment holdings and continued savings can have helped sustain the sector’s resource growth despite economic woes throughout the period, said John Paolo R. Rivera, a senior research fellow on the Philippine Institute for Development Studies.
“(This) reflects continued expansion in bank lending, deposit growth, and investment holdings, indicating that the economic system stays liquid and broadly resilient despite a more difficult macroeconomic environment,” he noted.
The most recent available BSP data also showed nonbanks held P6.347 trillion in resources as of end-2025. This reflects a 7.26% climb from the P5.917-trillion resources logged at end-2024.
Nonbanks include investment houses, finance firms, security dealers, pawnshops, and lending firms.
Institutions akin to nonstock savings and loan associations, bank card firms, private insurance firms, the Social Security System, and the Government Service Insurance System are also considered nonbank financial firms.
In the approaching months, analysts noted that tighter financial conditions amid lingering economic uncertainties could dampen the expansion of the financial sector’s resources.
“Looking ahead, while resources are expected to proceed expanding, the pace of growth may moderate amid tighter financial conditions, elevated inflation, and softer economic momentum,” Mr. Asuncion said.
“Key aspects to look at include BSP policy direction, liquidity conditions, risk sentiment, and the strength of domestic demand, which can collectively shape the trajectory of monetary system resources in the approaching months,” he added.
The industry also needs to strive to keep up healthy asset quality and credit conditions, especially as economic risks proceed to weigh on them, in line with Mr. Rivera.