Banks’ trust assets grow by 7.6%

Banks’ trust assets grow by 7.6%

THE TOTAL ASSETS of the Philippine banking industry’s trust and other fiduciary businesses grew by 7.6% year on year to P4.065 trillion as of end-September, based on the latest data from the Bangko Sentral ng Pilipinas (BSP).

This was above the P3.779 trillion in the same period in 2022 and a tad higher than the P4.063 trillion recorded at the end of the second quarter.

A trust business refers to any activity done under a trustor-trustee relationship. A trustee is appointed by a trustor to hold, administer, and manage their funds and/or properties to the benefit of the trustor.

Banks or nonbank institutions such as investment houses can be designated to have a business unit to perform trust functions. Securities and bank deposits make up the bulk of the trust industry’s assets. 

According to BSP data, cash and due from banks rose by 25% to P460 million as of end-September from P368 million in the comparable year-ago period.                

Total deposits grew by 41.3% to P1.08 trillion as of end-September from P764.65 billion last year.

Meanwhile, net financial assets dipped by 0.41% to P2.42 trillion from P2.43 billion a year earlier. 

Total loans, which include gross equity investments, also declined by 9.1% to P73.61 billion from P80.97 billion in 2022.

Under total accountabilities, trusts holdings stood at P1.4 trillion as of end-September, 7.9% lower than the P1.52 trillion a year ago.

Broken down, unit investment trust funds fell by 30.4% to P494.54 billion in the January-to-September period from P710.71 billion last year.

On the other hand, employee benefits went up by 12.8% to P353.88 billion year on year, while pre-need rose by 9.6% to P92.3 billion.

Agency trusts under total accountabilities climbed by 23% to P2.03 trillion from P1.65 trillion, while other fiduciary services rose by 3.3% to P627.59 billion from P607.23 billion a year prior.

Separate BSP data also showed universal and commercial banks managed P4.038 trillion of these trust holdings, 7.7% higher than the P3.75 trillion a year prior.

Meanwhile, thrift banks held P26.76 billion, 7% below the P28.79 billion in the same period in 2022. — Keisha B. Ta-asan