Filipinos avail of more loans for personal, household needs

MANILA, Philippines – Filipinos availed themselves of more loans to purchase household appliances as well as furniture and fixtures or to pay taxes as well as hospital and educational bills last year to take advantage of low interest rates.

Data released by the Bangko Sentral ng Pilipinas (BSP) showed that other consumer loans granted by universal and commercial banks as well as thrift banks to individuals to finance other personal and household needs went up by 14.42 percent to P46.35 billion last year from a year-ago level of P40.51 billion.

Thrift banks accounted for 65.5 percent of total loans for personal and household needs of Filipino consumers while universal and commercial banks cornered the remaining 35.5 percent.

Loans extended by thrift banks zoomed 24.92 percent to P30.34 billion last year from P24.32 billion in 2009 while that of universal and commercial banks retreated by 1.4 percent to P15.97 billion from P16.19 billion.

Other consumer loans accounted to 1.57 percent of the industry’s total loan portfolio that amounted to P2.96 trillion last year and 1.49 percent of P2.72 trillion loans extended in 2009.

The central bank slashed its key policy rates by 200 basis points between December 2008 and July 2009 to cushion the impact of the global financial crisis on the domestic economy.

However, the continued build prompted monetary authorities to make a preemptive move by raising key policy rates by 25 basis points last March 24 to keep inflation expectations well anchored amid escalating oil and food prices in the world market. –Lawrence Agcaoili (The Philippine Star)