BSP wants more comprehensive corporate lending database

MACTAN, Cebu — The Bangko Sentral ng Pilipinas (BSP) wants local conglomerates to report on their borrowing activities, in a bid to build a database covering their overseas exposure.

According to BSP Governor Felipe Medalla, the database would mitigate exposure risks, as he cited the case of firms that were hit due to their exposure to the indebted Chinese property developer Evergrande Group.

Fears of an Evergrande default rocked global markets in 2021, amid worries that it could impact the global economy. Local firms were spared

“What’s wrong with asking them magkano utang ninyo (how much is your debt)? I think that’s where the direction we’re moving,” Medalla told reporters at the sidelines of the BSP-IMF International Conference on Financial Stability.

“We actually wish we had even more complete data and under the law, we can actually ask them how much they have borrowed from abroad and in what currency, and what are the maturities,” he added.

Medalla added there are no laws preventing the data to be collected from conglomerates as even more information is being asked from households, noting that the collection of such information will address the data gaps in the Philippines.

“We’re exerting efforts so that we’ll be able to catch up on the data gaps here, and I’ll be lying if I told you that I’m satisfied with our current level,” he said.

Latest data available from the central bank show that consumer loans hit P349.45 billion as of December 2022, reflecting year-on-year growth of 62.19%, and a 15.01% share to the industry.

Outstanding loans of universal and commercial banks, net of reverse repurchase placements with the BSP, expanded by 10.1% in March, which the central bank attributed to the “sound” banking system of the country.—AOL, GMA Integrated News