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U/KBs NPL Ratio Improved Anew to 3.27 Percent in June

08.20.2010

As of end-June 2010, the non-performing loans (NPL) ratio of universal and commercial banks (U/KBs) improved by 0.10 percentage point to 3.27 percent from last month’s 3.37 percent and by 0.09 percentage point from year ago’s 3.36 percent ratio. This is the twenty-first consecutive month that the NPL ratio has been below four percent. 

The month-on-month development occurred as the 1.21 percent hike in NPLs was outpaced by the 4.29 percent rise in total loan portfolio (TLP). NPLs rose to P87.67 billion from last month’s P86.62 billion while TLP grew to P2,681.90 billion from P2,571.48 billion.

Net of interbank loans, the NPL ratio also eased to 3.71 percent from last month’s 3.77 percent and year ago’s 3.79 percent ratio. The improvement from last month transpired as the growth in NPLs was surpassed by the 2.73 percent expansion in regular loans to P2,362.28 billion.

The restructured loans (RLs) to TLP ratio went up to 1.67 percent from last month’s 1.63 percent but fell from year ago’s 1.82 percent ratio. The month-on-month increase in the ratio was fueled by the 6.74 percent growth in gross RLs to P45.12 billion.

Meantime, the real and other properties acquired (ROPA) to gross assets (GA) ratio got better to 2.26 percent from last month’s 2.29 percent and year ago’s 2.70 percent ratio. The month-on-month movement came about as the 0.75 percent reduction in ROPA to P129.52 billion was accompanied by the rise in GAs.

The non-performing assets (NPA) to GA ratio eased to 3.80 percent from last month’s 3.82 percent and year ago’s 4.33 percent ratio. The ratio favorably dropped from last month as the 0.03 percent hike in NPAs was surpassed by the larger growth in GAs. The NPA level stood at P217.19 billion, up from last month’s P217.12 billion but down from year ago’s P225.47 billion.

In terms of provisioning for bad loans, the NPL coverage ratio narrowed to 108.81 percent from last month’s 109.97 percent. Similarly, the NPA coverage ratio slid to 57.01 percent from last month’s 57.03 percent. Nonetheless, this month’s NPL and NPA coverage ratios still fared better than their year ago ratios of 102.33 percent and 50.59 percent, respectively.

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