Firstly, it is prudent to allow industry to adopt an evolutionary process, rather than adopting a revolutionary approach, in order to nurture acceptability and development of Islamic finance industry. Secondly, flexibility rather than rigidity allows for effective accommodation of changing needs of a dynamic market.
The capital adequacy ratios of the universal and commercial banking industry on solo and consolidated bases improved to 17.0 percent and 17.6 percent, respectively, in the first half of the year. These remain well above the 10.0 percent minimum threshold set by the BSP. Meanwhile, the gross non-performing loan ratio of the system continues to be manageable, standing at 4.5 percent in end-August.