Banking & Insurance

The various banks accelerated their lending activity in August, driven by a steady demand for credit from key business sectors. Big banks expanded their loan portfolios by 11 percent year-on-year, picking up speed from the 10.4 percent growth recorded in July.

The Philippines saw its net financial obligations to foreign lenders and investors expand to $65.6 billion as of end-June 2026, equivalent to 13.4 percent of the country’s Gross Domestic Product (GDP). It is a reflection of what the country owns abroad versus what it owes to foreign entities. Preliminary balance sheet figures show this liability expanded from $55.0 billion, or 11.2 percent of GDP, recorded at the end of March 2026.

Borrowing in foreign currencies by domestic industries drove a notable quarter-on-quarter increase in foreign currency deposit unit (FCDU) loans, which rose to $16.31 billion in the second quarter of 2026. This marks a 5.6 percent expansion from the $15.44 billion recorded in the previous quarter, signaling strong credit demand among key economic sectors operating in foreign trade and essential local industries.

Economic strains including higher prices for everyday goods are pushing most Filipinos to focus on covering current household expenses rather than setting money aside for future milestones, according to the latest Purple Report from East West Ageas Life Insurance Corp.

The Bangko Sentral ng Pilipinas expects headline inflation to settle between 6.4 percent and 7.4 percent for September 2026, pointing to persistent cost pressures that will continue to stretch consumer budgets and squeeze corporate margins.