BUSINESS

Strong local banks buttress economy

DT · Sep 22, 2023, 12:20 AM

Photograph courtesy of Bangko Sentral ng Pilipinas Bangko Sentral ng Pilipinas Deputy Governor Francisco Dakila Jr. and Assistant Governor Arifa Ala highlighted the strong financial system at the Philippine Economic Briefing in Dubai. They are part of the economoc team composed of (from left) Budget Undersecretary Margaux Marie Salcedo, Dakila, Budget Secretary Amenah Pangandaman, Finance Secretary Benjamin Diokno, National Economic and Development Authority Secretary Arsenio Balisacan, Assistant Governor Arifa Ala, and MENAT HSBC head of Communications Nick Edwards.

The strong banking system is considered a source of strength for the economy, Bangko Sentral ng Pilipinas Deputy Governor Francisco Dakila Jr. declared during the Philippine Economic Briefing on 12 September 2023 in Dubai.

The economic team visited the Middle Eastern country to discuss investment prospects in the Philippines, updates on the economy, the government's spending priorities, fiscal and infrastructure programs, and recent reforms that further opened the economy to foreign investors.
Around 80 senior executives representing investment funds, corporations, business associations and the media participated in the roadshow.

Dakila said banks are well-capitalized with a capital adequacy ratio, or CAR, of 16.4 percent on a consolidated basis as of the end of last March, above the minimum thresholds set by the BSP and the Bank for International Settlements.

Efficient funds conduit

The Philippine banking system's assets, deposits and profits also grew year-on-year by nine percent, eight percent, and 26.1 percent, respectively, in June this year.

"Indeed, the country's banking system continues to be an efficient and responsible intermediator of funds," he added.

BSP Assistant Governor Arifa Ala also highlighted the government's efforts to promote Islamic finance, including the issuance of its first sovereign Sukuk or Shari'ah-compliant bonds, which can expand the Philippines' engagement with Islamic financial markets.

Sukuk are certificates that represent shares in the ownership of assets, services, projects, or investment activities. These are issued under Shari'ah principles.

Speakers of the PEB in Dubai included Ambassador to the United Arab Emirates Alfonso Ferdinand Ver, Department of Finance Secretary Benjamin Diokno, Budget Secretary Amenah Pangandaman, National Economic and Development Authority Secretary Arsenio Balisacan, Standard Chartered regional head of global subsidiaries Shada Elborno, and MUFG Global Corporate and Investment Banking MENA chief executive officer Elyas Al Gaseer.