The BSP said the health of the thrift banking industry improved somewhat in September as bad loans went down slightly from P20 billion last year to P19.623 billion this year, pulling down the proportion of non-performing loans from 12.82 percent to 12.7 percent of the industry’s total loan portfolio.
Data from the BSP revealed that the industry’s NPL ratio in September also reflected an improvement from last year’s 13.37 percent although the industry is still far from being out of the woods.
Net of interbank loans (IBL), the BSP said the Industry’s NPL ratio was virtually unchanged from 13.3 in August to 13.04 percent in September as the industry’s regular banking activities managed to gather some momentum to avoid slowing down.
On the other hand, the BSP said thrift banks’ non-performing assets (NPA) ratio, also rose to16.32 percent from 16.36 percent as the industry’s NPAs increased to P43.846 billion in September from P43.27 billion last year.
However, the BSP said this year’s performance was still better than last year’s numbers where the industry’s NPL and NPA ratios were at 13.37 percent and 18.86 percent, respectively.
Upon closer examination, the BSP said the industry’s NPL coverage ratio actually widened, indicating an improvement in the cover for bad loans compared to the previous month.
The proportion of the industry’s loan loss reserves (LLR) to its NPL, according to the BSP, expanded from 38.25 in August to 38.69 percent in September. The BSP said there was a 4.9 percent increment in LLR, from P7.422 billion to P7.493 billion, but this was outpaced by the higher increase in NPL.
Moreover, the BSP said the industry’s NPA coverage ratio improved almost imperceptively from 16.32 percent in August to 16.36 percent in September. This reflected the decline in the proportion of LLR and provisions for Real and Other Properties Owned or Acquired (ROPOA) to the industry’s total non-performing assets.
On the other hand, the BSP reported that the ratio of the industry’s gross restructured loans (RL) to its total loan portfolio went up from 2.2 percent to 2.20 percent.
Restructured loans increased from P3.35 billion to P3.535 billion. ROPOA to gross assets, meanwhile, improved from 9.85 percent to 9.95 percent as ROPOA inched up from P26.197 billion to P26.730 billion while total assets also grew from P265.18 billion in August to P268.035 billion in September.