Bangko Sentral ng Pilipinas (BSP) Governor Eli M. Remolona, Jr. assures Philippine banks’ steady standing amid international oil crisis, per exclusive interview with BusinessWorld.
“We’re fortunate that when this energy shock happened, we were also in a good position to weather that shock. So, the banks are in very good shape,” the central bank’s head says outside the events held at the International Monetary Fund and World Bank’s 2026 Spring Meetings in Washington, D.C.
The sentiment arises as several banks in the country have raised concerns about their capitalization amid the economic shocks resulting from the rising tensions from global conflict between the U.S. and Iran.
In Comparison Against World Markets
Governor Remolona said Philippine banks’ capital stands at a capital adequacy ratio (CAR) of roughly about 16% relative to their assets, exceeding the 10% international standard.
“Some banks, a few banks, are worried about their capital, but it’s not systemic,” he added.
The central bank chief also noted that Philippine banks have maintained a high level of liquidity, with about 180% liquidity coverage ratio (LCR), well above the 100% global benchmark.
Remarkability shines – Philippines is outperforming other economies in the region.
In Indonesia, for example, the average CAR hovers around 14 percent, while Thailand and Vietnam maintain liquidity ratios closer to 120–130 percent.
Philippine banks, therefore, stand out as among the strongest in Southeast Asia. This comparative advantage not only boosts investor confidence but also positions the country as a reliable hub for financial services in the region.
For fintech companies, this stability provides fertile ground for innovation, allowing them to expand services such as e-wallets, remittances, and crypto-fiat conversions without worrying about systemic risks.
Why Confidence is Dropping
It is undeniable that the Philippines face persistent inflationary pressures and external hurdles.
Left and right, oil prices surge and fluctuate, disrupting service costs and delivery, limiting consumer purchase power and dampening demand in the market.
In a public statement, the BSP announces that the April 2026 inflation of 7.2% settled above the central bank’s forecasted range of 5.6% to 6.4%, highlighting the upside inflation risks emanating from the global oil price hike.
Resilience in Every Filipino
The BSP’s assurance comes at a time when global markets are volatile due to geopolitical conflicts and energy shocks.
Unlike some economies where banks struggle to meet capital requirements, Philippine banks are well-capitalized and liquid, making them resilient against external pressures.
Capitalization and Liquidity: Explained
Capital adequacy is a measure of a bank’s ability to withstand losses. With a 16% CAR, Philippine banks are not only compliant but significantly stronger than peers in other emerging markets.
On the other hand, strong liquidity ensures banks can meet short-term obligations. At 180%, Philippine banks are nearly double the global benchmark, meaning they can handle sudden surges in withdrawals or financial stress without collapsing.
What does it mean for the market?
A robust capital and liquidity foundation paves the way for safer deposits for customers, greater lending capacity for businesses, and stronger partnerships among key financial players, including fintechs and Electronic-Money Issuers (EMIs).
Implication for Digital Market Players like DOPAY
The digital finance world is interconnected – direct and indirect factors can lead to direct and indirect effects.
For BSP supervised financial institutions like DOPAY, strong banks mean reliable settlement systems for e-wallet transactions, secure remittance channels for Overseas Filipino Workers (OFWs), and stable crypto-fiat and fiat-crypto conversions for digital asset users.
A strong CAR means that banks can continue lending to businesses and individuals, fueling economic growth.
High LCR ensures that banks can handle sudden surges in withdrawals or financial stress without collapsing. In essence, the BSP’s assurance is a guarantee that the financial system is stable, resilient, and capable of supporting both traditional banking and modern fintech innovations.
This is particularly important for electronic money issuers (EMIs) and virtual asset service providers (VASPs), such as DOPAY, which rely on strong banking partners to facilitate seamless digital transactions.
Implication for Every Filipino Consumer
As market end-users, having reliable banks produces confident depositors.
Your money is safe – one is guaranteed that their money is safe in the bank, insured and untouched.
Additionally, credit lines remain accessible – individuals and business alike are not restricted as to credit access, lending capacities remain the same, if not with lowered requirements.
Stability of banks ensures that platforms like DOPAY can continue to provide seamless services, from e-wallet transactions to crypto exchanges. In short, the BSP’s statement is a vote of confidence in the entire financial system, encompassing both traditional and digital finance.
Gaps and Risks Involved
Despite the central bank’s assurance, risks still remain as the market remain volatile amid the global crisis.
Geopolitical tensions could affect energy prices and inflation, digital disruption requires banks to continuously upgrade cybersecurity, and climate-related risks may impact loan portfolios, especially in agriculture.
Filipino enterprises, big and small, deliver the effects to their products and services and consumers face the risk of absorbing the shock.
Banks may then face increased risks of loan defaults as businesses and individuals struggle to cope with rising expenses. While Philippine banks are currently well-positioned to absorb shocks, sustained global instability could test their resilience.
BSP as the Safeguard Machine
To enable domestic banks to remain healthy and in good standing, the BSP promises to closely monitor market movement and apply measures to aid inflation.
Along these safeguards, the central bank enforces strict regulations on capital and liquidity requirements, stress testing proof and passing, and promotion of financial inclusion among partner fintech companies locally.
The Takeaways
Looking ahead, Philippine banks must remain vigilant. They must continue to strengthen capitalization, enhance liquidity, and invest in technology.
It is important to adapt to emerging risks, such as climate change, which could impact loan portfolios in sectors like agriculture. At the same time, they must seize opportunities in digital finance, partnering with fintechs to expand financial inclusion and reach underserved communities.
The BSP’s proactive stance provides a strong foundation, but the responsibility for resilience ultimately lies with the banks themselves.
In conclusion, the BSP Governor’s statement underscores the strength and resilience of Philippine banks. With capital and liquidity levels well above global standards, the country is well-positioned to weather external shocks while supporting innovation in fintech and financial inclusion.
For depositors, businesses, and fintech users, this is a reassuring message: the financial system is stable, secure, and ready to support growth.
As the global economy faces uncertainty, the Philippines stands out as a beacon of resilience, offering confidence in both traditional banking and the future of digital finance.
