S&P Global Ratings has upgraded its risk assessment on the Philippine banking industry supported by the sector’s improved credit fundamentals.
The global credit rater said it upgraded its Banking Industry Country Risk Assessment (BICRA) score on the domestic banking industry to “6” from the previous “7.”
“We revised our Banking Industry Country Risk Assessment (BICRA) on the Philippines to group ‘6’ from group ‘7’ due to the sector’s improved credit fundamentals,” S&P said in a May 14 report.
S&P uses its BICRA framework to evaluate and compare global banking systems. Scoring is done on a 1-to-10 scale, with 1 being the best score or those with the lowest risks.
The debt watcher said the credit risk in the Philippines has reduced on the back of “the establishment of credit bureaus and the banks’ improving underwriting practices in the consumer loans segment.” — Karl Angelo N. Vidal