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Residential Real Estate Loans Grow by P13 Billion Last Year

05.21.2012

As of end-December 2011, total residential real estate loans (RRELs) was at P220.8 billion, higher by 6.5 percent (P13.4 billion) from last quarter’s P207.4 billion and by 17.3 percent (P32.5 billion) from last year’s P188.3 billion.  The quarter-on-quarter expansion came mostly from universal/commercial banks (U/KBs) which grew by P13.3 billion (12.0 percent) to P123.9 billion compared to the thrift banks’ (TBs) uptick of only P0.1 billion (0.1 percent) to P97.0 billion.  A year-on-year comparison likewise yields a similar story with the 34.3 percent (P31.6 billion) growth of U/KBs’ RRELs outpacing that of TBs at only 0.9 percent (P0.8 billion).

These led to the U/KBs grabbing a bigger share of total RRELs at 56.1 percent (P123.9 billion).   Last quarter, the proportion of RRELs that was held by U/KBs was only 53.3 percent (P110.5 billion) and last year it was 49.0 percent (P92.2 billion).  TBs on the other hand pitched in 46.7 percent (P96.9 billion) during the third quarter and 51.0 percent (P96.1 billion) last year.

As a percentage of TLP, total RRELs was slightly lower this quarter at 6.3 percent as against 6.4 percent last quarter as well as last year as the growth rate in total loan portfolio outweighed that of RRELs across the three comparative periods.

The ratio of non-performing RRELs to total RRELs eased to 4.3 percent from last quarter’s 4.7 percent and last year’s 6.9 percent ratio.  Meanwhile, the ratio of non-performing RRELs to TLP was maintained at its third quarter ratio of 0.3 percent although it was slightly better than last year’s ratio of 0.4 percent.  This is the lowest that these two ratios have been since 2008.  Similarly, the ratio of non-performing RRELs to total NPLs was kept stable at 7.5 percent from previous quarter but improved from 9.8 percent last year.

 By industry, TBs outperformed U/KBs in terms of non-performing RRELs to total RRELs ratio, posting 3.9 percent vis-à-vis U/KB’s 4.7 percent.  However, U/KB ratios were favorably lower for the non-performing RRELs to total NPLs ratio and the non-performing RRELs to TLP ratio at 5.7 percent and 0.2 percent, respectively compared with the TB ratios of 14.6 percent and 1.0 percent.

 In terms of protection from delinquent loans, the ratio of loan loss reserves (RRELs) to non-performing RRELs continued to grow, hitting 41.7 percent from 36.2 percent last quarter and 34.8 percent last year.

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