Philippine financial regulators are sounding off potential foreign exchange risks as big conglomerates face large debt maturities of about 1.6 trillion pesos ($26 billion) over the next three years. “Large conglomerates face a sizable wall of upcoming maturities and FX obligations,” according to the 2025 Financial Stability Report released on Monday. The maturities make up nearly a quarter of tota...
Philippine financial regulators are sounding off potential foreign exchange risks as big conglomerates face large debt maturities of about 1.6 trillion pesos ($26 billion) over the next three years. “Large conglomerates face a sizable wall of upcoming maturities and FX obligations,” according to the 2025 Financial Stability Report released on Monday. The maturities make up nearly a quarter of total debt by Philippine conglomerates and are scheduled to mature between 2027 and 2029, according to the annual report. Those obligations have sizable foreign-currency exposures, with US dollar-denominated debt averaging 37.6% of conglomerate debt over the next five years, it said. “While corporates have so far met refinancing needs through a mix of bond issuances, bank funding, and internal liquidity, refinancing and FX‑related risks warrant close monitoring given the scale and currency composition of upcoming maturities,” the report said. The report was prepared by an inter-agency council that includes the Bangko Sentral ng Pilipinas and the Department of Finance. It was released against the backdrop of a weak peso, which touched a record low this month. The Philippine currency has become one of the hardest hit in Asia from the surge in oil prices as the Southeast Asian nation imports almost all of its fuel requirements from the conflict-hit Middle East. Still, the Philippine financial system remained stable last year, with banks well-positioned to lend and have sufficient capital to absorb unexpected losses, according to the central bank. Apart from corporate leverage, the report also warned of risks from elevated property prices and growth of unsecured consumer loans which are mostly credit card debts. It also cited risks such as cyber threats and geopolitical tensions, such as the Iran war. “We will sharpen our coordination by defining when to escalate issues and by clearly communicating our assessment of our respective regulated entities,” BSP Governor Eli Remolona said...