2010 is banner year for banking sector — Tetangco

Bangko Sentral ng Pilipinas Gov. Amando Tetangco Jr. said that last year “could be one of the best years for Philippine banks.”

“With the use of modern technology, more people [have] become part of the financial mainstream, gaining access from the different corners of the archipelago. With the expansion of credit delivery channels, we have broadened and intensified our economic and financial education program to empower different sectors in society,” Tetangco said.

Microfinance loans granted by some 200 microfinance-oriented lenders to 993,000 borrowers totaled P6.53 billion as of end-September last year. In other words, banks disbursed loans averaging P7,000 per borrower — a hefty sum for people whose credit is considered not good enough for larger commercial banks.

“What is inspiring is that many of these microborrowers have also become net savers with deposit accounts in banks,” Tetangco pointed out.

These achievements have been cited by organizations like the UK-based Economist Intelligence Unit through its “2010 Global Microscope on Microfinance” report.

The report ranked the Philippines as the world’s second best performing country for microfinance.

The country’s microfinance program was the world’s best in terms of policy and regulatory framework, the report also showed.

Tetangco credited the willingness of banks to cooperate with the regulators and supporting reform measures that helped make the local banking system “sound and stable through the difficult periods.”

“If we remain united in pursuing much needed reforms, we can transform our banking system to become even stronger and even more effective catalyst for development,” Tetangco said.

The strong momentum for domestic economic activity drove the banking sector’s lending growth to accelerate to P2.244 trillion as of end-November last year, from P2.059 trillion recorded in the same period in 2009.

The robust economic activity was fed in part by the remittances of millions of overseas Filipino workers and the influx of foreign capital that pushed the country’s stock of foreign currency reserves to an all-time high of $62.1 billion as of December last year.

These developments happened within a year when some of the most advanced countries in the Americas and Europe have been mired in recession.

“One of the reasons behind the sustained growth of our economy is our banking system, which has remained sound, stable, and liquid through the recent global economic and financial crisis,” Tetangco said. — JE/KBK, GMANews.TV