The other financial corporations (OFCs), a key segment of the Philippine financial system outside traditional banks, insurers, and pension funds, expanded their domestic assets to ₱10.6 trillion in the first three months this year, reflecting a 4.9 percent increase quarter-on-quarter and a robust 14.6 percent growth year-on-year, according to preliminary data from the Bangko Sentral ng Pilipinas (BSP).
OFCs comprise non-money market investment funds, financial auxiliaries, other financial intermediaries (excluding banks, insurers, and pension funds), captive finance institutions, and money lenders. These entities play a crucial role in channeling funds into various sectors of the economy, acting as non-bank conduits for investment, credit, and financial intermediation.
The sector’s liabilities reached ₱11.2 trillion, up 6.2 percent from the previous quarter and 16.2 percent higher compared to 1Q 2024. Liabilities were mainly composed of issued shares, bonds, and domestic loans.
OFCs also maintained significant exposure to key economic sectors. Their claims included ₱3.1 trillion on depository corporations (mainly bank deposits), ₱2.7 trillion on the central government (largely in government securities), and ₱4.8 trillion on other sectors — primarily private corporations and household loans.
Cross-border activities remained modest but expanding, with OFCs holding ₱0.8 trillion in foreign assets and ₱0.2 trillion in liabilities to nonresidents, resulting in net foreign assets of ₱0.6 trillion — a sharp 34.1 percent rise from the previous quarter and 52.8 percent higher year-on-year.
The BSP has since explained the expanding importance of OFCs in supporting market-based financial flows and investment diversification, underlining their increasingly systemic role in the broader financial ecosystem.
