State of the Philippine Banking Industry

Terminologies

❏ HFT - Assets Held for Trading

❏ DFVLP - Designated Fair Value through Profit or Loss

❏ AFS - Available for Sale

❏ Total Capital - refers to the total sum of paid-in capital

❏ NPL - Non-performing Loans

❏ ROPA - Real and Other Properties Acquired

❏ NPA - NPL + ROPA

A Status Report on the Philippine Financial System

BSP Semestral Status Report

Section 39 (c) of the Article V of RA 7653

The Monetary Board shall publish and submit one hundred twenty (120) days after the end of each semester, a review of the state of the financial system.

1st Semester of 2015

❏ The banking system composed more than 80.8% of the Philippine Financial System (PFS).

❏ Banks’ resources expanded by 9.0% to ₱ 11.2 T (end-June 2015).

❏ Total Deposit Liability continue to be main source of funds growing 9.0%, but considerably lower than 2013 36.7% growth. Total Deposit to Total Asset is 76.92%.

1st Semester of 2015

❏ Net profit grew 8.1% to ₱ 68.9 B, where:

❏ Interest-based revenues grew 7.8%

❏ Non-interest based income grew 11.0%.

❏ Trading income grew 35.9%.

ASEAN INTEGRATION

ASEAN Financial Integration Framework to be fully implemented by 2018.

BSP’s initiatives to accomplish the framework:

❏ Financial Services Liberation

❏ Capital Account Liberation

❏ Capital Market Development

❏ Harmonized Payments and Settlement Systems

RA 10641

❏ Liberalized the PHL Banking industry by allowing foreign banks to own up to 100% (from 60%).

❏ Foreign banks can now open 6 branches.

Newly Opened Foreign Banks under RA 10641

❏ Sumitomo Mitsui Banking Corp. (KB, JPN)

❏ Shinhan Bank Co. Ltd. (KB, KOR)

❏ Cathay United Bank Co. Ltd. (KB, TWN)

❏ Industrial Bank of Korea (KB, KOR)

❏ Yuanta Commercial Bank Co. Ltd. (TB, TWN)

❏ United Overseas Bank (KB, SGP)

RECENT HIGHLIGHTS

❏ Circular 908 - Agricultural Value Chain Financing Framework

❏ Philippines and Malaysia Sign Agreement on Entry of Banks under ABIF

❏ BSP closed 14 Rural banks in 2015, 4 rural banks so far in 2016.

THANK YOU.