FCDU loans up at end-Sept.

OUTSTANDING LOANS granted by banks’ foreign currency deposit units (FCDU) inched up as of end-September 2023 from the previous quarter, as disbursements exceeded principal repayments.

Loans granted by the FCDUs of banks went up by 0.7% to $15.5 billion as of September from $15.39 billion at end-June, the Bangko Sentral ng Pilipinas (BSP) said in a statement late Friday.

Year on year, outstanding FCDU loans declined by 1.1% from $15.67 billion.

FCDUs are BSP-approved bank units that perform transactions involving foreign currencies, including deposits and loans.

Gross disbursements rose by 18.8% to $17.1 billion as of September from $14.4 billion as of end-June due to higher funding requirements of a foreign bank branch affiliate, the BSP said. 

Loan repayments also increased by 17.4% to $17 billion from end-September, which resulted to an overall net disbursement.

The bulk of banks’ FCDU loan portfolio was made up of medium- to long-term debt, or those payable in more than a year, which stood at $12.032 billion and made up 77.6% of the total. This was lower than the previous quarter’s 78.3% share.

FCDU loans granted to residents amounted to $9.396 billion or 60.6% of the total loans at end-September, with $9.274 billion of this amount (59.8%) going to private firms.

Most of these loans went to power generation companies ($2.4 billion or 25.3%), merchandise and service exporters ($2.3 billion or 24.5%), and towing, tanker, trucking, forwarding, personal and other industries ($1.3 billion or 13.5%). 

FCDU loans to nonresidents totaled $6.105 billion during the nine-month period.

Meanwhile, FCDU deposit liabilities increased by 5.7% to a fresh record high of $51.8 billion as of end-September 2023 from $49 billion in the previous quarter.

“The bulk of these deposits ($50.4 billion or 97.3%) continued to be owned by residents, essentially constituting an additional buffer to the country’s gross international reserves,” the BSP said.

Year on year, FCDU deposit liabilities went up by 6% from $45.8 billion at end-September 2022.

The overall FCDU loans-to-deposit ratio stood at 29.9% in the January-to-September period, down from the 31.4% recorded at end-June and the 34.2% seen a year prior. — Keisha B. Ta-asan