The Philippine banking system sustained its growth momentum in the first half of 2025 on broad-based asset expansion and solid profitability, the Bangko Sentral ng Pilipinas (BSP) said Friday.
The system’s total assets grew 7.7 percent year-on-year to P28.2 trillion as of end-June 2025, supported by stable domestic deposits and strong capital and liquidity buffers, the BSP said in its first semester report on the Philippine financial system.
Combined profits of Philippine banks rose 4.1 percent year-on-year to P198.1 billion.
Loans and investments accounted for 84.2 percent of the total assets, which kept the system’s overall asset quality satisfactory. System-wide loans expanded 10.9 percent to P15.9 trillion in June.
The real estate sector was the largest borrower, accounting for 18.1 percent of total loans. This was followed by household (14.8 percent), electricity (10.6 percent), wholesale and retail trade (10.4 percent) and manufacturing (7.9 percent).
The report also highlighted that banks continued to advance inclusive growth. Loans to micro, small and medium enterprises (MSMEs) climbed 11.2 percent to P544.8 billion. Total financing to agriculture, fisheries and rural development reached P2.4 trillion, surpassing the mandated lending quota.
The non-performing loan (NPL) ratio of the banking system improved to 3.3 percent in June, down from 3.5 percent a year earlier. NPLs grew at a slower pace of 5.5 percent to P530.3 billion.
Trust and foreign currency deposit units (FCDU) also posted robust double-digit asset growth in June, accounting for 28.2 percent and 15.9 percent of the banking system assets, respectively. Both operations remained profitable.
Net profits increased by 12.2 percent to P4.6 billion for trust operations and 22.6 percent to $437.6 million for FCDUs.
Total deposits in the banking system rose 5.9 percent to P20.7 trillion, while total capital increased 10.6 percent to P3.5 trillion in the first half of the year.
“The banking system’s solid performance underscores its strength in seizing opportunities, navigating emerging risks, driving innovation, and championing inclusive and sustainable growth,” said BSP Governor Eli Remolona Jr.
“In line with this, the BSP will continue pursuing policies that further strengthen the banking system. This supports an environment that helps banks to continue growing, supporting economic activity, and responding to the evolving needs of Filipinos,” Remolona said.
