BSP: PH Financial System Resilient amid Global Challenges, 2024 Financial Stability Report reveals

The Financial Stability Coordination Council (FSCC) has released its 2024 Financial Stability Report (FSR). It highlights the resilience and stability of the Philippine financial system despite global headwinds driven by geopolitical tensions and policy shifts.

​The report underscores key factors that contributed to this stability. These factors include declining inflation, robust output growth, and ample international reserves. The Philippine banking system maintained ample capital and liquidity buffers, ensuring its capacity to absorb potential losses while continuing to support economic activity. Additionally, financial markets exhibited no signs of asset price misalignments, while enjoying strong domestic investor participation.

FSCC Chair and Bangko Sentral ng Pilipinas (BSP) Governor Eli M. Remolona, Jr. underscored the financial system's adaptability in a dynamic global environment. “In a year full of change, the Philippine financial system demonstrated strength, backed by an improved understanding of market dynamics and lessons from the past,” said Governor Remolona.

The report also highlights the vigilance of financial authorities over risks such as asset valuation, leverage, debt servicing, and the increasing role of non-bank financial institutions. Governor Remolona emphasized the collective responsibility in managing systemic risks: “In an interconnected market, individual decisions can create ripple effects. Systemic risk management is a collective effort.”

To further bolster financial stability, the 2024 FSR outlines strategic measures such as deepening the bond market, enhancing reporting frameworks, and developing macroprudential tools.

The FSCC—comprising the BSP, Department of Finance, Insurance Commission, Philippine Deposit Insurance Corporation, and Securities and Exchange Commission—publishes the FSR annually to assess the health of the country’s financial system. The 2024 report is now available on the websites of FSCC member agencies.