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Manila Bulletin devider Business devider Banking & Finance devider Philippine banks remain 'well capitalized' despite global, domestic headwinds—FSCC

Philippine banks remain 'well capitalized' despite global, domestic headwinds—FSCC

Published Jul 7, 2025 01:49 pm
The inter-agency Financial Stability Coordination Council (FSCC) reassured that Philippine banks maintain robust capitalization and ample liquidity buffers, navigating through global and local challenges.
The BSP said in a statement released on Monday, July 7, that during the FSCC’s meeting for the second quarter, it “assessed potential vulnerabilities linked to changing global financial conditions, geopolitical tensions, and domestic liquidity shifts.”
FSCC members during the 41st Financial Stability Coordination Council (FSCC) Executive Committee Meeting recently held at the Bangko Sentral ng Pilipinas. Top, from left to right: BSP Assistant Governor Veronica B. Bayangos, BSP Bank Officer VI Christofer A. Martin, PDIC Senior Vice President Sandra A. Diaz, PDIC President Roberto B. Tan, BSP Governor and FSCC Chairman Eli M. Remolona, Jr., SEC Chairperson Atty. Francis Edralin Lim, SEC Chairman Chief of Staff John Cedrick De Leon. Bottom, from left to right: PDIC Vice President Jose G. Villaret, Jr., National Treasurer Sharon P. Almanza, DOF Assistant Secretary Neil Adrian S. Cabiles, IC Deputy Commissioner Arturo S. Trinidad II, BSP Assistant Governor Lyn I. Javier, and PDIC General Counsel Atty. Maria Antonette B. Bolivar.
FSCC members during the 41st Financial Stability Coordination Council (FSCC) Executive Committee Meeting recently held at the Bangko Sentral ng Pilipinas. Top, from left to right: BSP Assistant Governor Veronica B. Bayangos, BSP Bank Officer VI Christofer A. Martin, PDIC Senior Vice President Sandra A. Diaz, PDIC President Roberto B. Tan, BSP Governor and FSCC Chairman Eli M. Remolona, Jr., SEC Chairperson Atty. Francis Edralin Lim, SEC Chairman Chief of Staff John Cedrick De Leon. Bottom, from left to right: PDIC Vice President Jose G. Villaret, Jr., National Treasurer Sharon P. Almanza, DOF Assistant Secretary Neil Adrian S. Cabiles, IC Deputy Commissioner Arturo S. Trinidad II, BSP Assistant Governor Lyn I. Javier, and PDIC General Counsel Atty. Maria Antonette B. Bolivar.
According to the BSP, these factors “could impact asset valuations, debt servicing, market volatility, and trade,” but still, the council reassured that domestic banks “remain well-capitalized with sufficient liquidity buffers.”
As of end-March, the country’s short-term external debt, based on remaining maturity, reached $32.7 billion.
For the BSP, “this level remains well-covered by the country’s gross international reserves (GIR)” or United States (US) dollar stock, which amounted to $106.7 billion, providing 3.3 times cover for short-term obligations.
The BSP asserted earlier that the country’s US dollar stock level “continues to provide a robust external liquidity buffer, despite the downward trend of the short-term external debt cover in recent years.”
Also, “the FSCC reviewed efforts to strengthen financial resilience through continuous risk monitoring and policy initiatives, including proposed reforms to the deposit insurance system.”
The council is also enhancing its analytical tools to more effectively monitor systemic risks across different sectors and time periods.
Meanwhile, a volatile market, uncertain policy, beyond-control geopolitical pressures, and technological disruptions are major challenges seen to threaten the stability of the Philippine financial system “in the near term.”
Identifying these salient risks is part of the council’s move to strengthen its “forward-looking surveillance.” Measures monitoring and addressing the risks that emerged were also reviewed during the meeting.
FSCC Chair and BSP Governor Eli M. Remolona Jr. said that “the FSCC remains committed to inter-agency coordination, data-driven risk monitoring, and deploying needed measures to preserve market confidence and financial system stability.”
Alongside the quarterly meeting, the FSCC also welcomed Francis E. Lim, the new Securities and Exchange Commission (SEC) chairman.
The FSCC is composed of the BSP, the Department of Finance (DOF), the Insurance Commission (IC), the Philippine Deposit Insurance Corp. (PDIC), and the SEC. It coordinates efforts to monitor and manage systemic risks within the Philippine financial system.

Related Tags

Financial Stability Coordination Council (FSCC) Bangko Sentral ng Pilipinas (BSP) Eli M. Remolona Jr. Securities and Exchange Commission (SEC) Francis Ed. Lim
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