TOTAL loans availed of by thrift and rural banks under the peso rediscount facility of the central bank plunged nearly 94 percent in the first 10 months of the year from a year ago amid ample liquidity in the financial system.
Borrowings by thrift and rural banks under the rediscount facility dropped by 93.6 percent to P1.1 billion from January to October compared to P17.5 billion a year earlier, data released on Monday by the Bangko Sentral ng Pilipinas (BSP) showed.
The rediscounting facility allows qualified banks to borrow from the central bank using their eligible borrowers’ papers as collateral. The facility helps banks meet their short-term liquidity needs.
Meanwhile, use of the exporters’ dollar and yen rediscount facility also saw a sharp drop in the period.
Only one universal bank and one thrift bank availed of a combined $8.8 million from the financing facility, benefiting three exporters, down by 91.8 percent from the $106.7 million recorded in the same period last year, the BSP said.
Of the peso rediscount loans availed, 77.9 percent went to commercial credits, 6.1 percent went to agricultural and industrial credits, and the remaining 16 percent went to other credits such as permanent working capital (5.4 percent), capital expenditure (5.1 percent), other services (4.3 percent), and housing (1.2 percent).