CITING lower real estate and auto loan rates, the Bangko Sentral ng Pilipinas (BSP) said banks have begun passing on to their lending business the monetary authorities’ cut in key interest rates.
“On the impact of policy rate easing by BSP, latest data show banks have passed on about 40 percent of the cut in policy rates in terms of lower bank lending,” BSP Governor Amando Tetangco Jr. said.
The BSP has reduced its policy rates by 175 basis points since December, bringing the overnight borrowing and lending rates to 4.25 percent and 6.25 percent, respectively.
Tetangco said banks could not pass on 100 percent of the rate cut, as the financial institutions are cautious due to the global financial crisis.
“This has been the experience not only of the Philippines but also in other countries. I have spoken with my counterparts with the other countries and they have confirmed that from their own experience, there is a less than 100 percent pass-through,” the governor said.
The BSP said local banks offer mortgage rates of 8.75 percent to 9.75 percent for the first year, 10.25 percent for the five-year tenor, and 10.75 percent to 11 percent for the 10-year.
“That is also the reason why we have tolerated a higher than normal growth in M3 [domestic liquidity] relative to economic growth and inflation,” Tetangco said.
Outstanding loans of commercial banks including placements with the BSP grew by 13.4 percent in April, slower than the 18.9 percent registered in March.
Domestic liquidity or M3 rose by 13.7 percent year-on-year, a slight deceleration from the 15.6 percent in March.
The BSP earlier said inflation is unlikely to accelerate despite increasing international oil prices due to the domestic economy’s slow recovery.
It forecast inflation to reach 3.4 percent this year, down from 9.3 percent last year.
Development Bank of Singapore had said the ongoing rise in oil and commodity prices could limit the scope for further rate cuts in the Philippines.
The Singaporean lender however said the BSP is likely to cut its policy rates by 25 basis points during the Monetary Board’s next meeting on July 9. –Maricel E. Burgonio, Senior Reporter, Manila Times
March –
IT’S WOMEN’S MONTH!
“Respect and support women
every day of the year/s!”
Invoke Article 33 of the ILO Constitution
against the military junta in Myanmar
to carry out the recommendations of the 2021 ILO Commission of Inquiry
against serious violations of protocols of
Forced Labour and Freedom of Association.
Accept the National Unity Government (NUG)
of Myanmar. Reject Military!
#WearMask #WashHands
#Report Corruption #SearchPosts #TakePicturesVideos
Monthly Observances:
Women’s Role in History Month
Weekly Observances:
Week 1: Environmental Week;
Women’s Week
Week 3: Philippine Industry and “
Made-in-the-Philippines Products Week
Last Week: Protection and Gender-Fair Treatment
of the Girl Child Week
Daily Observances:
March 8: Women’s Rights and
International Peace Day;
National Women’s Day
March 4: Employee Appreciation Day
March 15: World Consumer Rights Day
March 18: Global Recycling Day
March 21: International Day for the Elimination
of Racial Discrimination
March 23: International Day for the Right to the Truth
Concerning Gross Human Rights Violations
and for the Dignity of Victims
March 25: International Day of Remembrance of the
Victims of Slavery and the Transatlantic Slave Trade
March 27: Earth Hour
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