The industry’s Non-Performing Loans (NPL) ratio improved to 13.85 percent, as defined under BSP Circular No. 351, from 14.65 percent last quarter. Even without the re-definition, the NPL ratio would have been 14.15 percent, still lower by 0.73 percentage point from last quarter’s ratio of 14.88 percent per BSP Circular No. 202. Rural Banks’ (RBs) NPL ratio went down to 13.76 percent from 14.55 percent a quarter ago. Likewise, Cooperative Banks’ (CBs) NPL ratio fell to 15.01 percent from last quarter‘s 15.87 percent.
Loan loss reserves (LLR) to NPL or NPL coverage ratio increased to 34.78 percent from 34.19 percent last quarter with both RBs and CBs exhibiting improved coverage ratios of 34.86 percent from 34.29 percent and 33.88 percent from 33.12 percent, respectively, from last quarter.
The ratio of Real and Other Properties Owned or Acquired (ROPOA), gross to gross assets went down to 8.92 percent from 9.02 percent last quarter with some P2.74 billion worth of additional assets versus ROPOA growth of only P158 million. RBs reported a lower ROPOA to gross assets ratio this quarter at 9.25 percent from 9.38 percent last quarter while CBs’ ROPOA to gross assets ratio increased to 4.15 percent from a quarter ago’s 4.08 percent. Meanwhile, the ratio of Non-Performing Assets or NPA (NPL plus ROPOA) to gross assets improved by 0.66 percentage point to 17.31 percent from 17.97 percent last quarter.
NPA coverage ratio (LLR plus ROPOA reserves to NPA) was down to 18.14 percent from 18.20 percent a quarter ago with the industry having lesser provisioning for NPAs with a 0.72 percent decrease in total NPA reserves.
The ratio of gross restructured loans (RL) to TLP decreased to 2.40 percent from 2.58 percent last quarter as RLs decreased by 4.31 percent or P0.05 billion to P1.21 billion.
Total past due (past due plus items in litigation) of the industry fell by 0.22 percent or P0.02 billion (P8.49 billion from P8.51 billion last quarter). The decrease in past due level coupled with an increase in TLP by 2.74 percent or P1.34 billion, brought down past due ratio (total past due over TLP) to 16.83 percent against last quarter’s 17.33 percent.