Thrift banks’ non-performing loan ratio climbs to 7.71% in March

MANILA, Philippines – The non-performing loan (NPL) ratio of thrift banks stood at 7.71 percent as of end-March 2009, up 0.55 percentage point from the previous quarter’s 7.16 percent, latest data from the Bangko Sentral ng Pilipinas (BSP) showed.

Compared to the year-ago level of 6.67 percent, the end-March NPL was higher by 1.04 percentage points.

The increase from last quarter was due to the 9.03-percent buildup in NPLs, the BSP said.

“Nonetheless, the industry was able to sustain a single-digit NPL ratio for the past 16 quarters and pinned it below the pre-crisis ratio of 7.74 percent (as of end-June 1997) for the past seven quarters,” the BSP said.

Exclusive of interbank loans (IBL), the NPL ratio also went up to 7.91 percent as of end-March from 7.61 percent the prior quarter as NPLs expanded faster than core lending, which posted an ample growth of 4.85 percent to P292.54 billion.

The first quarter’s ratio registered higher than the year-ago level of 7.65 percent as the NPL buildup outpaced the expansion in core lending.

Restructured loans, meanwhile, contracted by 1.8 percent to P4.11 billion in March, the central bank said.

Thus, the proportion of restructured loans (RLs) to total loan portfolio (TLP) at 1.36 percent went down from the prior quarter’s 1.4 percent and the year-ago ratio of 1.5 percent.

The ratio of real and other properties acquired (ROPA) over gross assets slid to 4.66 percent from the previous quarter’s 5.33 percent. This occurred as ROPA dropped 11.16 percent to P23.52 billion.

The non-performing assets (NPA) ratio improved to 9.29 percent from the past quarter’s 9.63 percent, data from the BSP also showed.

In addition, the quarter’s ratio was 0.35 percentage point better than the year ago ratio of 9.64 percent.

Meanwhile, the NPL coverage ratio narrowed by 2.33 percentage points to 48.85 percent from 51.18 percent the past quarter.

The cutback stemmed mainly from the faster buildup in NPLs, negating the 4.06 percent enhancement in loan loss reserves (LLR) to P11.3 billion. Quite the opposite, the quarter’s NPL cover was wider than year ago’s 48.64 percent ratio.

The NPL ratio of rural banks, meanwhile, stood at 10.84 percent as of end-March, up by 0.73 percentage point from the previous quarter’s 10.11 percent.

This ratio was also 1.06 percentage points higher than the previous year’s ratio of 9.78 percent.

The quarter-on-quarter rise in the delinquency ratio was brought on by the growth in NPLs by 5.87 percent to P10.12 billion and the 1.24 percent drop in total loan portfolio (TLP) to P93.39 billion, the BSP said.

Meantime, the NPA coverage ratio of rural banks widened by 0.74 percentage point to 23.95 percent from 23.21 percent. This developed as NPA reserves grew 6.38 percent.  Likewise, the NPA coverage ratio was higher than the year ago’s 21.79 percent ratio. –Iris C. Gonzales, Philippine Star