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Domestic claims of other financial firms climb to P7.21 trillion in Q2

DOMESTIC CLAIMS of nonbank financial firms rose in the second quarter of 2022, according to the Bangko Sentral ng Pilipinas (BSP).

Preliminary data from the BSP’s Other Financial Corporations Survey (OFCS) showed domestic claims of nonbank financial firms rose by 1.7% year on year to P7.206 trillion in the second quarter from the P7.08 trillion seen in the comparable year-ago period.

The OFCS is an analytical survey of the assets and liabilities of the OFC sector. It uses standardized report forms as required by the International Monetary Fund.

These include individual financial statements from insurance firms, holding companies, government financial institutions, investment companies, and other financial intermediaries, as well as consolidated financial statements from trust institutions.

“In Q2 2022, the OFCs’ claims on the private sector expanded due primarily to the increase in loans extended to households as well as higher investments in equity securities issued by private nonfinancial corporations,” the BSP said in a statement on Monday.

“In addition, the growth in the domestic claims can be attributed to OFCs’ higher claims on the National Government due to the sector’s increased holdings of government securities,” it added. 

OFCs’ net claims on the central government grew by 10.2% year-on-year to P1.746 trillion in the second quarter of 2022 and rose by 5.4% from the prior three-month period.

“On the other hand, the OFCs’ claims on depository corporations declined in Q2 2022 compared with the same period last year, owing to the decline in the sector’s bank deposits and holdings of bank-issued debt securities,” the BSP said.

Claims on depository corporations decreased by 17.1% year on year to P1.507 trillion and dropped by 3.6% compared with the first-quarter level.

“Meanwhile, OFCs’ net foreign assets rose significantly in Q2 2022, largely on account of higher investments in debt and equity securities issued by nonresident entities,” the central bank said. 

BSP data also showed net foreign assets (NFA) held by other financial corporations jumped 25% to P232.50 billion year on year but declined by 7.7% versus the prior quarter.

“The increase in OFCs’ assets was funded mainly by the sector’s issuances of shares and other equity,” the central bank added.

Claims of OFCs on non-residents rose by 24.3% year on year to P420.06 billion, slower than the 40.8% growth seen in Q1 2022.

Liabilities to non-residents grew by 23.4% year on year to P187.57 billion and by 9.7% from Q1 2022. — K.B. Ta-asan

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