Total bank deposits hit ₧15T as Pinoys saved more in ’20

@Bnicolasbm

TOTAL bank deposits in the country reached nearly P15 trillion during the pandemic year, up by 9 percent from P13.6 trillion in 2019 as Filipinos were inclined to save money.

Latest data released by state-run Philippine Deposit Insurance Corp. (PDIC) showed total bank deposits hit P14.9 trillion as of end-december last year.

Likewise, deposit accounts also rose to 80.1 million last year, rising by 8.7 percent from 73.7 million in the same period the previous year.

The state-run deposit insurer also said the sustained growth in deposits shows more savers are benefitting from the protection provided by PDIC up to the maximum deposit insurance coverage (MDIC) of P500,000 per depositor per bank.

“The pandemic underscored the important role banks play in enabling access to essential financial services,” PDIC President and CEO Roberto B. Tan was quoted in a statement as saying. “The deposit growth is also an indication of improved depositor confidence in the banking system.”

Boost in deposits also mirrored the 8.8-percent expansion of fully insured deposit accounts to 77.4 million from 71.2 million in 2019.

According to the PDIC, this represents 96.7 percent of the total fully insured deposit accounts.

In terms of amount, P1.7 trillion total deposits is fully covered by deposit insurance, an 8.6-percent climb from P1.6 trillion in the same period in 2019.

Meanwhile, deposits with balances above P500,000 increased to P13.1 trillion, surging by 9 percent from P12 trillion in December 2019.

Total number of accounts reached 2.7 million by end of last year, higher than the previous year’s 2.5 million.

Despite the pandemic, most deposit types posted increases both in terms of the number of accounts and the amount.

Accounting for the bulk or 75.9 percent of total domestic deposits are savings deposits and demand/ NOW deposits. Savings deposits and demand and/or NOW (Negotiable Order of Withdrawal) deposits increased by 16.2 percent and 20.8 percent to reach P7.2 trillion and P4.1 trillion, respectively.

However, the state deposit insurer said time deposits and Long-term Negotiable Certificates of Deposit (LTNCDS) dropped by 11.8 percent year-on-year to P3.6 trillion from P4.1 trillion in end-december 2019 due to depositors’ preference for liquidity in uncertain times that will allow them to withdraw cash immediately.

“Combined, time deposits and LTNCDS summed to P3.6 trillion and accounted for 24.1 percent of total deposits,” it said.