Banks’ FCDU loans down 3.1% in Q3

Banks' foreign currency deposit unit (FCDU) loans slightly declined in the third quarter as repayments exceeded disbursements, the central bank reported on Tuesday.

Total outstanding FCDU loans stood at $11.8 billion, 3.1 percent lower than the $12.1 billion in the second quarter, the BSP revealed.

The Bangko Sentral ng Pilipinas defines an FCDU as a unit of a local bank, or the local branch of a foreign bank, authorized by the BSP to engage in foreign currency-denominated transactions, including deposit taking and loan granting, under R.A. 6426, or the Foreign Currency Deposit Act.

Loans granted to the majority of debtor types during the quarter declined from the second quarter—exporters down by 3.0 percent, public utilities by 2.3 percent, oil companies by 75.7 percent, and other borrowers including non-residents by 2.2 percent).

"Some borrowers may have shifted to domestic financing as peso loans showed a growth of 5.0 percent from P4.3 trillion to P4.6 trillion for the same period," the BSP said.

Loans to producers and manufacturers, however, rose by 0.6 percent.

The bulk of the loans granted went to resident borrowers accounting for 70.8 percent, with major beneficiaries including public utility firms (16.8 percent); producers and manufacturers including oil companies (6.8 percent); merchandise and service exporters (22.9 percent).

This also went to management/holding and stock brokerages (7.2 percent); and towing, tanker, trucking, forwarding, personal, & other individuals (12.8 percent).

The $0.5 billion balance of outstanding loans or 3.9 percent went to other residents as well as government agencies and enterprises.

Gross disbursements during the quarter totaled $15.8 billion, 20.9 percent higher than the previous quarter's $13.0 billion, largely for working capital.

FCDU deposit liabilities likewise rose to $33.2 billion—97.3 percent of these deposits currently held by residents.

On the other hand, loans-to-deposit ratio dropped to 35.4 percent from 38.1 "as a consequence of the higher rate of contraction of loans and increase in deposits," the BSP said. — Jon Viktor D. Cabuenas/BM, GMA News