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U/KBs' NPL Ratio Stands at 2.95 Percent in April

06.10.2011

As of end-April 2011, the non-performing loans (NPL) ratio of universal and commercial banks (U/KBs) stood at 2.95 percent, an improvement by 0.04 percentage point from 2.99 percent at end-March 2011 and by 0.39 percentage point from year ago's 3.34 percent ratio. This is the third consecutive month that the NPL ratio has been below three percent.

The month-on-month improvement was due to the 2.57 percent expansion in total loan portfolio (TLP), which outpaced the 1.25 percent increase in NPLs.  U/KBs' NPLs rose to P83.44 billion as of end-April 2011 from last month's P82.41 billion while TLP reached  P2,830.50 billion from P2,759.61 billion.

Net of interbank loans, the NPL ratio eased to 3.16 percent from last month's 3.21 percent and year ago's 3.79 percent ratio. The ratio declined from last month as the growth in NPLs was offset by the 2.93 percent increase in regular loans to P2,642.91 billion from P2,567.67 billion last month.

The restructured loans (RLs) to TLP ratio fell to 1.48 percent from last month's 1.54 percent and year ago's 1.74 percent ratio. The month-on-month decline in the ratio was mainly due to the 1.45 percent decrease in gross RLs to P42.21 billion.

Meantime, the real and other properties acquired (ROPA) to gross assets (GA) ratio remained at 1.98 percent from last month and improved from year ago's 2.35 percent ratio. This developed as the 0.65 percent reduction in ROPA to P121.93 billion outpaced the 0.59 percent cut in GAs to P6,139.23 billion. 

The non-performing assets (NPA) to GAs ratio slightly went up to 3.35 percent from last month's 3.32 percent but improved from year ago's 3.89 percent ratio. The increase in the ratio from last month was due to the 0.11 percent expansion in NPAs to P205.37 billion from last month's P205.14 billion, which was accompanied by the reduction in GAs.

The industry provided adequate provisioning against potential credit losses.  The NPL coverage ratio strengthened to 121.06 percent from last month's 120.37 percent and year ago's 108.90 percent. Likewise, the NPA coverage ratio (NPA reserves to NPAs) widened to 62.88 percent from last month's 62.07 percent and year ago's 55.93 percent ratio.

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