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TBs' NPL Ratio Rises Slightly in June

12.18.2015

The ratio between the gross non-performing loans (NPLs) of thrift banks (TBs) and their total loan portfolio (TLP) stood at 4.69 percent at end-June this year.

The figure is a slight increase from the 4.54 percent gross NPL ratio registered in March as the banks’ gross NPLs rose at faster pace than their TLP quarter-on-quarter.

At end-June this year, TBs’ posted gross NPLs of Php 29.95 billion, up from the Php 27.29 billion recorded a quarter earlier. The banks’ TLP, on the other hand, expanded to Php 638.15 billion in June from Php 600.98 billion in March.

The TB industry also continued to set aside substantial reserves as buffer for potential credit losses. At the end of the second quarter this year, TBs provisioned for 71.63 percent of gross NPLs. The figure stood at 74.96 percent last March.

The TBs’ gross NPLs also remained manageable across economic sectors as seen in real estate activities and loans to individuals for consumption purposes, which represented 64.1 percent of the banks’ TLP in June this year.

The Bangko Sentral ng Pilipinas monitors banks’ loan quality in line with its broader objective of fostering sound credit risk management which is essential to financial stability.

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