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U/KBsí NPL Ratio at 2.39 Percent

01.13.2012

As of end-November 2011, the non-performing loans (NPL) ratio of universal and commercial banks (U/KBs) further improved to 2.39 percent.  This ratio was lower by 0.15 percentage point from last month’s 2.54 percent and by 0.67 percentage point from year ago’s 3.06 percent ratio.  The month-on-month decline in the NPL ratio resulted from the combined effect of the 2.59 percent decrease in NPLs to P75.37 billion from P77.38 billion and the 3.58 percent increase of the total loan portfolio (TLP) to P3,157.08 billion from P3,048.07 billion.

Net of interbank loans, the NPL ratio likewise eased by 0.16 percentage point to 2.53 percent from last month’s 2.69 percent and by 0.80 percentage point from year ago’s 3.33 percent ratio.  The ratio lowered from last month as the cut in NPLs was complemented by the 3.64 percent hike in regular loans to P2,981.31 billion from P2,876.51 billion.

Meantime, the restructured loans (RLs) to TLP ratio went down to 1.28 percent from 1.33 percent last month and from year ago’s 1.58 percent ratio. The drop in the ratio from last month stemmed from the 0.40 percent fall in gross RLs which was accompanied by the expansion in TLP.

Real and other properties acquired (ROPA), gross to gross assets (GAs) ratio trimmed to 1.75 percent from last month’s 1.80 percent and from year ago’s 2.08 percent ratio. The month-on-month development came with the 0.29 percent reduction in ROPA.

The non-performing assets (NPA) to GAs ratio stood at 2.91 percent at end-November 2011, better than month ago’s 3.03 percent and year ago’s 3.46 percent ratio. The lower ratio from last month was driven by the 1.21 percent contraction in NPAs and the 2.69 percent expansion in GAs.

The industry continued to provide adequate provisioning against potential credit losses. The NPL coverage ratio (LLRs to NPLs) strengthened to 122.20 percent from last month’s 119.07 percent and from year ago’s 116.58 percent ratio. Similarly, the NPA coverage ratio (NPA reserves to NPAs) widened to 62.86 percent from 62.15 percent last month and from year ago’s 59.64 percent ratio.

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