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U/KBs NPL Ratio Improved Anew to 3.56 Percent in March

05.22.2009

As of end-March 2009, the non-performing loans (NPL) ratio of universal and commercial banks (U/KBs) improved by 0.17 percentage point to 3.56 percent from last month’s 3.73 percent and by 0.96 percentage point from year ago’s 4.52 percent ratio. This is the sixth consecutive month that the NPL ratio has been kept below four percent.

The month-on-month development transpired as the 1.32 percent decline in NPLs came with the 3.25 percent growth in total loan portfolio (TLP). NPLs were reduced to P88.58 billion from last month’s P89.76 billion while TLP grew to P2,486.52 billion from P2,408.35 billion.

Net of interbank loans, the NPL ratio also improved to 3.98 percent from last month’s 4.19 percent and from year ago’s 5.22 percent ratio. The easing of the ratio from last month took place as the drop in NPLs was accompanied by the 3.78 percent expansion in regular loans to P2,225.52 billion.

 Meantime, the real and other properties acquired (ROPA) to gross assets (GA) ratio was maintained at 2.74 percent from last month but favorably dropped from year ago’s 3.31 percent ratio. The ratio remained unchanged from last month as the 0.71 percent increase in ROPA to P140.43 billion was almost matched by the expansion in GAs.

The non-performing assets (NPA) to GA ratio eased to 4.49 percent from last month’s 4.53 percent and year ago’s 5.43 percent ratio. The month-on-month development came about as the 0.09 percent drop in NPAs was complemented by the 0.81 percent growth in GAs. The NPA level stood at P229.00 billion, down from last month’s P229.20 billion and year ago’s P247.35 billion.

The restructured loans (RLs) to TLP ratio dropped to 2.03 percent from last month’s 2.21 percent and year ago’s 2.90 percent ratio. The decline in the ratio from the previous month transpired as the 5.33 percent drop in gross RLs to P50.75 billion was accompanied by the expansion in loans. 

In terms of provisioning for bad loans, the NPL coverage ratio strengthened to 99.30 percent from last month’s 96.29 percent. Similarly, the NPA coverage ratio widened to 49.11 percent from 48.57 percent.  Year-on-year, this month’s NPL and NPA coverage ratios stood favorably lower than their reference ratios of 93.29 percent and 46.80 percent, respectively.

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