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U/KBsí NPL Ratio Eases to 3.07 Percent in November

01.21.2011

As of end-November 2010, the non-performing loans (NPL) ratio of universal and commercial banks (U/KBs) eased by 0.13 percentage point to 3.07 percent from last month’s 3.20 percent and by 0.19 percentage point from year ago’s 3.26 percent ratio. This is the twenty-sixth consecutive month that the NPL ratio has been below four percent.
 
The month-on-month development occurred as the 0.02 percent reduction in NPLs was accompanied by the 4.14 percent expansion in total loan portfolio (TLP). NPLs fell to P83.33 billion from last month’s P83.35 billion while TLP grew to P2,711.78 billion from P2,604.05 billion.
 
Net of interbank loans, the NPL ratio also improved to 3.34 percent from last month’s 3.49 and year ago’s 3.74 percent ratio. The improvement from last month took place as the drop in NPLs came with the 4.62 percent rise in regular loans to P2,497.23 billion.

The restructured loans (RLs) to TLP ratio went down to 1.58 percent from last month’s 1.66 percent and year ago’s 1.72 percent ratio. The ratio dropped from last month as the 1.04 percent reduction in gross RLs to P43.27 billion came with the rise in loans.

Meantime, the real and other properties acquired (ROPA) to gross assets (GA) ratio got better to 2.08 percent from last month’s 2.19 percent and year ago’s 2.48 percent ratio. The ratio fell from last month as the 0.51 percent drop in ROPA to P127.19 billion came with the growth in GAs.

The non-performing assets (NPA) to GA ratio improved to 3.46 percent from last month’s 3.63 percent and year ago’s 4.04 percent ratio. The month-on-month development came about as the 0.32 percent decline in NPAs was complemented by the expansion in GAs. The NPA level stood at P210.52 billion, down from last month’s P211.19 billion and year ago’s P221.25 billion.

In terms of provisioning for bad loans, the NPL coverage ratio slid to 116.53 percent from last month’s 117.15 percent. In contrast, the NPA coverage ratio slightly widened to 59.68 percent from last month’s 59.67 percent. Year-on-year, this month’s NPL and NPA coverage ratios fared better than their reference ratios of 109.77 percent and 54.73 percent, respectively.

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