Credit card receivables up 13%

Credit card receivables (CCRs) of commercial banks went up by nearly 13 percent to P18.4 billion as of the end of 1999 from P16.3 billion in 1998, according to the Bangko Sentral ng Pilipinas.

The amount was a 6.3 percent increase from P17.3 billion in the previous quarter of 1999.

The BSP reported that from 1.1 percent in 1998, CCRs in 1999 represented an equivalent share of 1.2 percent of total loan portfolio of commercial banks.

The BSP noted, however, that the past due portion of CCRs slightly fell at 22.6 percent from 22.9 percent at end-September 1999, as growth in CCRs of 6.3 percent outpaced the 5.3 percent increment in past due CCRs.

The BSP said that branches of foreign banks (FXBs) cornered about 73 percent of the industry's exposure in CCRs.

Expanded commercial banks (EKBs) obtained 25.6 percent while non-EKBs' accounted for just 1.9 percent.

The BSP also reported that as of end-December 1999, the exposure of commercial banks to auto loans (ALs) further declined to P8.6 billion from P9.1 billion at end-September 1999 and from 21.1 percent at end-December 1998. This represents a mere 0.5 percent of commercial banks' total loan portfolio.

Although on a downtrend volume-wise, from P1.5 billion as of end-September 1999 to P1.4 billion as of end-December 1999, the auto loan past due ratio, however, rose to 16.2 percent of total loans from 15.9 percent in end-September 1999 largely due to the contraction in auto loans of six percent that outmatched the 3.7 percent drop in overdue auto loans.

The BSP commented that while the commercial banking industry's exposure to auto loans and credit card receivables are still relatively low and within controlled limits, banks with rising delinquency ratios are being closely monitored to safeguard the overall asset quality of the industry.

Following the 1997 crisis, banks have tightened up their credit evaluation.

In fact, banks have significantly tightened up on auto loans processing and credit card applications.

However, the credit card business continues to be a growth area for most banks with competition increasing.