‘Banks face credit strain on prolonged Middle East crisis’MANILA, Philippines — Philippine banks may begin to feel mounting credit pressure in the coming months as spillover risks from a prolonged Middle East conflict filter through vulnerable loan segments, Fitch Ratings said. He noted that these segments have expanded as banks “diversify away from the larger conglomerates,” but have historically shown greater vulnerability during economic shocks. The ratings agency also flagged the country’s exposure to remittances from the Middle East as a key transmission channel, which could weigh on borrowers’ repayment capacity if disruptions intensify. Across South and Southeast Asia, Fitch warned that banks face rising credit risks from higher energy prices, supply chain disruptions and weaker demand linked to geopolitical tensions. In a separate note, the ratings agency said “the clearest credit risk from a prolonged Middle East conflict” would emerge gradually, particularly in emerging markets where borrower resilience is weaker.

Source: Philippine Star April 12, 2026 16:44 UTC