The Bangko Sentral ng Pilipinas (BSP) said on Friday that foreign currency deposit unit (FCDU) loans as of end-September 2012 stood at $7.6 billion, down by $167 million or 2.1 percent from the end-June 2012 level.

In a statement, BSP Gov. Amando Tetangco Jr. said that this development may be attributed to the low interest rate environment, which has encouraged enterprises to obtain peso funding to reduce foreign exchange exposures, notwithstanding the strengthening of the peso.

”Year-on-year, however, an expansion of 15.8 percent, or $1 billion in the FCDU loan portfolio was noted because of improved business sentiment arising from positive developments in the economy,” he said.

The maturity profile of outstanding FCDU loans was as follows; medium- to long-term (MLT) loans (or those payable over a term of more than one year) represented 62.6 percent of total, up from 61.5 percent in the previous quarter; while short-term (ST) accounts (or those with original maturities of up to one year) comprised the 37.4 percent balance.

Tetangco also noted that loans to resident borrowers (mainly from the private sector) represented 82.2 percent of the total portfolio, with the following as major beneficiaries; public utility firms (27 percent), merchandise and service exporters (22.2 percent), producers/manufacturers, including oil companies (14.7 percent), and others (18.3 percent).
Furthermore, gross disbursements during the quarter amounted to $3.5 billion with the bulk representing short-term loans.

Tetangco added that, “FCDU deposit liabilities marginally decreased to $25.7 billion, or by 0.09 percent from end-June 2012. The bulk of these deposits [97.9 percent] continued to be held by residents. The overall loans-to-deposits ratio slightly decreased to 29.5 percent, compared to 30.2 percent as of June 2012.”