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Update on KB NPL as of April

06.14.2001

As of month-end April 2001, Non Performing Loans (NPL) ratio of commercial banks further rose to 16.65 percent from 16.60 percent (amended figure) in March 2001. Loan quality was affected by the 2.7 percent rise in NPL which outpaced the 2.4 percent loan increments. Net of interbank loans (IBL), NPL ratio leveled at 18.30 percent from previous month’s 18.29 percent. 

This month’s coverage ratio (Loan Loss Reserves divided by NPL) slightly deteriorated to 42.4 percent from 42.7 percent last month as the 2.7 percent (P7.0 billion) NPL hike outmatched 2.0 percent (P2.2 billion) incremental cover for loan losses. Consistently, Foreign Banks’ (FXBs) coverage ratio topped at 126.0 percent compared to Expanded Commercial Banks’ (EKBs) 40.8 percent and Non Expanded Commercial Banks’ (NEKBs) 34.2 percent.  

Gross restructured (RLs) loans increased by 1.1 percent from P99.4 billion to P100.4 billion. However, larger increments in Total Loan Portfolio (TLP) of P36.9 billion or 2.4 percent slightly pushed down ratio of RLs to 6.3 percent of TLP compared to last month’s 6.4 percent. 

Holdings of Real and Other Properties Owned and Acquired (ROPOA net) thinned by 0.2 percent or P322.0 million to P131.1 billion from P131.4 billion last month (from P100.4 billion a year ago), brought on mainly by P383.0 million cutdown by EKBs. Ratio of net ROPOA to total assets receded to 4.3 percent (from 4.4 percent) as assets simultaneously grew by 2.0 percent. 

Overall asset quality as measured by the non-performing asset  (NPA) ratio slightly improved at 13.2 percent from last month’s 13.3 percent as the 2.0 percent rise in total assets offset the 1.8 percent hike in non-performing assets (NPL plus gross ROPOA). Consistently, NEKBs’ NPA ratio topped at 16.3 percent, with EKBs’ at 14.8 percent in contrast to FXBs’ low 1.9 percent.  

Using an even broader definition of loan quality, the ratio of NPL plus current restructured loans plus gross ROPOA to TLP plus ROPOA slightly improved at 26.7 percent from 26.8 percent last month. Last year’s ratio was at 23.4 percent. 

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