FCDU loans jump 21% to $7.2 B in 2011

MANILA, Philippines - Loans extended by foreign currency deposit units (FCDUs) of banks operating in the Philippines jumped 21.1 percent last year as disbursements to financial services as well as manufacturers and exporters increased, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.

According to the BSP, FCDU loans amounted to $7.204 billion at the close of 2011 or $1.255 billion from the end-2010 level of $5.949 billion.

The BSP said resident borrowers accounted for 91.6 percent of the total loans or $6.7 billion while 8.4 percent or $600 million were disbursed to non-resident borrowers.

By economic activity, data showed that the biggest borrowers were the manufacturing sector with a share of 40.2 percent followed by electricity, gas, and water supply sector with 16.2 percent as well as transport, storage, and communications sector with 10.3 percent.

 “These top three sectors constituted 66.7 percent of the total FCDU loans to residents,” the BSP said.

Loan quality improved as FCDU non-performing loans (NPL) ratio eased to 0.5 percent from 0.7 percent last year, while last year’s 0.1 percent ratio was maintained on the FCDU non-performing assets (NPA) ratio.

Moreover, the NPL and NPA coverage ratios of FCDUs widened to 363.4 percent and 361.1 percent, respectively, from last year’s 276.3 percent and 275.3 percent ratios.

Deposit liabilities, which contracted by three percent to $24.2 billion from $24.9 billion last year, remained the largest source of funds at 80.4 percent share of total resources. Resident depositors accounted for 97.5 percent of total deposit liabilities while the remaining 1.5 percent came from non-resident depositors.

The BSP said the net profit in 2011 was relatively unchanged from last year’s $1.023 billion from $1.034 billion as the rise in operating income was matched by the combined increase in non-interest expenses and provision for/write-off of bad debts.

By industry, the universal and commercial banks accounted for 96.3 percent with $1 billion of net profit while thrift banks contributed the remaining 3.7 percent or less than half of $100 million.

As of end-December 2011, total resources of FCDUs increased by 1.4 percent to $30.1 billion from $29.7 billion at end-year 2010.

Universal and commercial banks accounted for 95.8 percent or $28.8 billion of the total FCDU assets while thrift banks held 4.2 percent or $1.3 billion. Rural and cooperative banks contributed less than half of 0.1 percent share or $1million.