Peso rediscount loans down 96.5%

MANILA, Philippines - Loans under the peso rediscount facility of the Bangko Sentral ng Pilipinas tumbled by nearly 97 percent in February as liquidity conditions remain adequate.

In a report, the BSP said loan availments amounted to P282 million as of February, down 96.5 percent from P8.102 billion a year ago.

Of the total availments, 71.6 percent went to commercial credits, 2.9 percent for agricultural and industrial credit, and 25.5 percent to permanent working capital, other services, and capital expenditure.

The BSP said only thrift and rural banks borrowed from the central bank during the period.

The rediscount facility allows banks to borrow from the BSP to meet short-term liquidity needs. Banks use their clients’ promissory notes as collateral when tapping the facility.

Availments under the BSP’s dollar rediscount facility declined 97.7 percent to $800,000 as of February from $34.3 million in the same period last year.

The dollar availments was made by a lone thrift bank and benefited one exporter, the BSP said.

Lesser availments under the rediscount facilities show the healthy state of the local banking industry and that banks have enough liquidity to cover funding needs.

Total resources of the banking system reached P10.423 trillion as of end-2013, up 25 percent from P8.358 trillion in 2012.