The Philippine financial system’s total resources rose nearly 10% year on year as of May, reaching a record high driven by strong bank assets and lending activity.
Combined resources of domestic banks and nonbank financial institutions stood at P37.638 trillion in the first five months of the year, up 9.98% from P34.224 trillion a year earlier.
The increase was supported by banks’ total assets and loan growth rates of more than 10% each, even as global uncertainty persisted from the Middle East conflict.
Bank assets climbed about 11.7% year on year to a record P30.442 trillion at end-May, surpassing the prior peak set in March.
Lending by large banks expanded 12.1% annually to P14.989 trillion in May, the fastest pace in 15 months.
Economists said the figures reflect the resilience of the banking sector, with higher deposits, sustained credit demand, and expanding investment portfolios supporting balance sheet growth.
The 9.98% resource growth marked a slight easing from 10.58% at end-April, though analysts described the slowdown as normalization rather than weakness.
Banks held the majority of system resources at P31.291 trillion, up 10.85% from a year ago.
Universal and commercial banks accounted for P29.011 trillion, a 10.72% increase, while thrift banks rose 10.95% to P1.489 trillion.
Rural and cooperative banks posted P587 billion in resources, up 8.06%, and digital banks saw a 45.4% surge to P203.7 billion.
Nonbank financial institutions held P6.347 trillion in resources as of end-2025, 7.26% above the prior year, spanning entities such as finance firms, insurers, and state-run funds.
Analysts noted the local financial system remains liquid and well-capitalized, positioned to support economic activity if credit and savings trends stay healthy.
However, rising borrowing costs and tighter monetary conditions may temper loan growth in the coming months.
The central bank has raised its key policy rate by 50 basis points since April to 4.75%, with officials indicating room for further tightening to return inflation to its 3% target.
