China Bank Savings Inc. (CBS), the Philippines’ second-largest thrift bank in terms of assets, has nearly doubled its loan-loss reserves to cover bad loans in the first half of 2026, even as the ratio of soured loans to its loan book remained lower than the banking industry’s.

CBS said in a statement that it has almost doubled its loan-loss reserves to cover non-performing loans (NPLs), reflecting its “prudent credit risk management and conservative provisioning policy during challenging conditions.”

Its asset quality “remained sound,” with its NPL ratio standing at approximately 2.9 percent in the first half, lower than the banking sector’s 3.29 percent.

The increase in reserves came as CBS’ profit reached ₱1.2 billion in the first half of the year, which the lender said sustained its performance from the same period last year.

CBS further noted that its profit reflected financial stability amid “ongoing global geopolitical uncertainties and a challenging economic environment.”

According to CBS President James Christian T. Dee, the bank’s asset quality has remained resilient despite these external pressures.

“Our disciplined approach to lending has kept our portfolio sound and strong amid prevailing global geopolitical uncertainties and their impact on Philippine economic growth, inflation, and other factors,” Dee said, adding that the bank intends to “continue to grow our lending business in a prudential manner.”

CBS’ revenue growth was anchored by a 16-percent annual increase in net interest income, which reached ₱5.5 billion. This was driven by an eight-percent expansion in its gross loan portfolio to ₱158.8 billion, with particular strength in the salary and business loan segments.

On the funding side, deposits grew by 10 percent to ₱199.4 billion, providing what the bank described as a stable base for continued lending.

Additionally, CBS continued to expand its physical footprint, opening five new branches and converting 10 branch-lite units into full-service branches during the first half of the year. This expansion brought its total network to 190 branches and 33 APD Lending Centers.

Jan Nikolai M. Lim, CBS senior vice president and retail banking group head, noted that the bank’s growth strategy remains focused on financial inclusion.

“There are still unbanked communities all around the Philippines. The current challenging conditions are tough, but we know from experience that Filipinos are tougher,” Lim said.

He stressed that consumers and entrepreneurs need banking services to support their families and businesses, which further reinforces the lender’s expansion plans.

Looking ahead, CBS aims to maintain this momentum by focusing on higher-yielding loans and improving operational efficiency through ongoing investments in both its physical branch network and digital banking platforms. - Derco Rosal