• Peso rediscount loans down 95% end-May

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    Total loans received by thrift and rural banks under the peso rediscount facility of the central bank continued to decline in the first half of the year, as thrift and rural banks mostly avoided borrowing from the special window.

    Rediscounting is a privilege given by the BSP to banks that are qualified to obtain loans or advances using eligible borrowers’ papers as collateral.

    Data from the Bangko Sentral ng Pilipinas (BSP) on Thursday showed that total loans availed of by thrift and rural banks under the rediscount facility fell by 95.2 percent to P735 million in January to June from P15.468 billion in the same period a year earlier.

    Also, banks’ use of the Exporters Dollar and Yen Rediscount Facility recorded a year-on-year decline in the period, showing only a universal bank and a thrift bank availing of a combined $4.8 million of the financing facility, benefiting two exporters.

    This reflects a 93.7 percent drop in availments, compared with the $75.6 million taken in the same period last year, the BSP said.

    Of the P735 million rediscounted loans released through the banks in the six-month period, commercial credits accounted for 82.1 percent, agricultural and industrial credits 3.6 percent, and the remaining 14.3 percent went to other credits such as permanent working capital (5.8 percent), other services (4.8 percent), capital expenditure (2.3 percent), and housing (1.4 percent).

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