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Philippine Flow of Funds

The Flow of Funds (FOF), which is part of the System of National Accounts (SNA), is a summary of the financial transactions among the institutional sectors of the domestic economy, and between these sectors and the rest of the world. In the Philippines, the FOF is presented as an integrated matrix of the capital and financial accounts of each institutional sector and the whole economy, linking saving, capital accumulation, and the related financial flows.¹

Reference periods: 2022 and 2023

Release date: 4 December 2025

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Overall, the results of the 2022 and 2023 Philippine Flow of Funds (PFOF) showed continued expansion in domestic saving and capital accumulation, reflecting sustained economic recovery and growth following the COVID-19 pandemic.²

• Domestic saving returned to pre-pandemic levels, increasing from ₱3.8 trillion in 2021 to ₱4.5 trillion in 2022 and ₱5.0 trillion in 2023. The upward trend was supported by continued profitability in non-financial industries and higher government tax revenues. Increased income from core banking operations in 2022 and improved labor market conditions in 2023 also contributed to the growth in saving during the said periods.

• Real investments in the domestic economy surged from ₱4.1 trillion in 2021 to ₱5.4 trillion in 2022, reaching a record high of ₱5.7 trillion in 2023. This was driven by robust infrastructure spending from both private and public sectors, alongside higher household demand for residential properties.

The domestic economy remained a net borrower from the rest of the world (ROW), with net borrowing rising from ₱0.3 trillion in 2021 to ₱1 trillion in 2022, before easing to ₱0.7 trillion in 2023. These developments were largely driven by the expansion of the trade in goods deficit in 2022 and its subsequent contraction in 2023 amid fluctuations in import commodity prices.³
                                                                                                                                                                

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¹ Source: 2008 SNA and Monetary and Financial Statistics Manual and Compilation Guide (MFSMCG)
² The Philippine Gross Domestic Product (GDP) grew by 13.5 percent in 2022 and 10.4 percent in 2023. Source: National Accounts of the Philippines (NAP) as of April 2025, Philippine Statistics Authority (PSA)
³ The Philippine current account posted a deficit of US$5.9 billion in 2021, US$18.3 billion in 2022, and US$12.4 billion in 2023. Source: Balance of Payments, Bangko Sentral ng Pilipinas (BSP)

Higher domestic saving was driven by the Non-Financial Corporations (NFCs), the General Government (GG), and Financial Corporations (FCs), while the Households’ (HHs’) saving slightly declined in 2022.

By sector, drivers of saving in 2022 were as follows:

• NFC – continued productivity and profitability of wholesale and retail trade; transportation and storage; and construction industries.^4,5
• GG – higher tax revenues collected by the National Government (NG) and local government units (LGUs) and increased contributions from members of social security funds (SSFs).^6,7,8
• FC – higher bank interest income on loans and intermediation fees on deposits.^9,10,11

Meanwhile, the decline in HHs’ saving was due to higher household consumption expenditures.

Higher domestic saving was driven by the GG, NFCs, and HHs, while the FCs’ saving slightly declined in 2023.

By sector, drivers of saving in 2023 were as follows:

• NFC – continued productivity and profitability of wholesale and retail trade; transportation and storage; and construction industries.
• HH – post-pandemic labor market recovery and higher Overseas Filipino remittances.¹²
• GG – higher tax revenues collected by the NG and increased contributions from members of SSFs.¹³

Meanwhile, the decline in FCs’ saving was due to higher domestic interest expenses and dividend payments of the Central Bank (CB).

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⁴ The wholesale and retail trade industry includes the repair of motor vehicles and motorcycles.
⁵ Sources: NAP as of April 2025, PSA; BusinessWorld Top 1000 Corporations in the Philippines; and Construction Statistics from Approved Building Permits, PSA
⁶ In the Philippines, the General Government (GG) sector comprises the central government (CG), local government units (LGUs), and social security funds (SSFs). The CG consists of the National Government (i.e., budgetary units) and extrabudgetary units (i.e., the Philippine National Railways and the National Irrigation Administration). Meanwhile, the SSFs include the Government Service and Insurance System (GSIS), Social Security System (SSS), and the Philippine Health Insurance Corporation (PhilHealth).
⁷ Tax collections, which accounted for almost 90% of the NG’s total revenues in 2023, reached ₱3.4 trillion in 2023 from ₱3.2 trillion in 2022. Source: Annual Financial Report of the NG, Commission on Audit (COA)
⁸ Source: Annual Audit Reports of the GSIS, SSS, and PhilHealth
⁹ The FC sector consists of all resident corporations, including quasi-corporations, that are principally engaged in providing financial services, including insurance and pension services, to other institutional units. This is composed of the following resident institutional units: the Central Bank, the other depository corporations (ODCs), and the other financial corporations (OFC).
¹⁰ The ODCs sub-sector is composed of universal/commercial banks, thrift banks, rural and cooperative banks, non-banks with quasi-banking functions, non-stock savings and loan associations, money market funds (MMFs), and offshore banking units.
¹¹ The OFCs sub-sector include trust entities, private and public insurance companies, pre-need companies, holding companies, government financial institutions (specifically government corporations engaged in financial intermediation), non-MMFs covering unit investment trust funds and investment companies, and other financial intermediaries and auxiliaries (consisting of non-banks without quasi-banking functions).
¹² Sources: Labor Force Survey (2023), PSA; Overseas Filipinos’ Remittances (2023), BSP
¹³ Source: Annual Audit Report of the GSIS, SSS, and PhilHealth

                                                                                                                                                                                                                                                                           

Domestic capital accumulation rose across most sectors in 2022 and 2023, except for a decline in FCs’ real investment in 2022.

By sector, drivers of real investment in 2022 and 2023 were as follows:

• GG – higher infrastructure spending of the NG and increased spending on land acquisitions/improvements, and public construction by the LGUs.^14,15
• HH – higher demand for housing units amid rising residential real estate prices.¹⁶
• NFC – higher expenditures on transport equipment and transportation-related infrastructure projects.^17,18
• FC – the decline in 2022 was driven by the lower net acquisitions of repossessed/foreclosed assets of the OFCs. Meanwhile, the increase in 2023 was driven by higher net acquisitions of investment properties by trust institutions, other intangible assets by banks, and inventories by the CB.¹⁹

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¹⁴ In particular, the Department of Public Works and Highways (DPWH) demonstrated robust spending performance, while disbursements from development partners for major infrastructure projects - South Commuter Railway Project, Malolos-Clark Railway Project, North-South Commuter Railway Project, and Metro Manila Subway Project – further boosted the NG’s overall infrastructure expenditures. Source: NG Disbursement Performance, Department of Budget and Management (DBM)
¹⁵ Source: Annual Financial Report of the LGUs, COA
¹⁶ Source: December 2023 Real Estate Exposure – Philippine Banking System – Universal/Commercial Banks, BSP and 2023 Residential Real Estate Price Index, BSP
¹⁷ List of projects under construction under the Philippine Public-Private Partnership (PPP) Program. Source: Budget of Expenditures and Sources of Financing, DBM
¹⁸ Source: Gross Domestic Capital Formation in Durable Equipment, NAP, PSA
¹⁹ Investment properties refer to assets purchased for long-term capital appreciation, initially measured at cost plus directly attributable expenditures. These properties are subsequently accounted for using the cost model, except for certain institutional accounts (e.g., pre-need, employee benefit accounts like retirement and pension funds with long-term commitments, and insurance companies), which use the fair value model. Source: Financial Reporting Package for Trust Institutions, BSP

                                                                                                                                                                                                                                                                           

The domestic economy’s overall net borrowing in 2022 and 2023 was due to the developments in the net financing of the NFCs, GG, and HH.

By sector, drivers of higher net borrowing in 2022 were as follows:

• NFC – shifted to net borrowing to fund the surge in private NFCs’ infrastructure investments through higher bank loan availments and debt security issuances.
• GG – slightly higher net borrowing to finance infrastructure projects, as reflected in the NG's net withdrawal of deposits with the CB, lower investments in equity and investment fund shares, and sustained, albeit lower, government security issuances.²⁰
• HH – lower net lending to fund increased spending and real investments through higher loan availments.

Meanwhile, the FCs’ net lending grew due to the increased net provision of loans by ODCs and the higher net withdrawals of the GG’s deposits from the CB.

By sector, drivers of lower net borrowing in 2023 were as follows:

• NFC – decreased net borrowing due to the deceleration in capital build-up, as reflected in lower bank loans.
• HH – increased net lending as reflected through higher currency holdings, deposits, and investments in insurance, pension, and standardized guarantee schemes.
• GG – lower net borrowing amid higher saving, as evident in the increased holdings of currency and deposits by the NG and availability of more funds from higher loan repayments by SSF members.

Meanwhile, the FCs’ net lending declined due to reduced net deposit placements by OFCs and the CB’s higher loan liabilities to ODCs.

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²⁰ The NG’s lower investments in equity and investment fund shares in 2022 were largely due to the unwinding of the one-off capital infusions in Land Bank of the Philippines and Development Bank of the Philippines in 2021.

                                                             
                                                             
                                                             
                                                             
                                                             
                                                                                                                                                                                                                                                                           
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Technical Notes

Revision Policies

The Philippine Flow of Funds (PFOF) statistics are compiled and disseminated annually. Data are treated as preliminary when first released, and may be revised coinciding with the publication of the next annual PFOF report to incorporate restated data and other updates. Historical revisions are carried out in cases of significant changes arising from updates in the compilation frameworks and methodologies as well as availability of new data.