BSP rediscounting total

The Bangko Sentral ng Pilipinas’s (BSP) peso rediscounting facility increased to R973 million as of endOctober with banks availing of the liqudity tool for commercial credits.

The rediscounting loans were R370 million more compared to endSeptember’s R603 million.

The banks use the proceeds of rediscounting loans for new loans to other borrowers, or to address its liquidity needs. In effect, the rediscounting cycle helps sustain the bank’s funds for relending to its borrowers and, at times, service withdrawals.

Based on BSP data, about 92.1 percent of rediscounting loans were for commercial credits, a small portion or 6.3 percent were borrowed for services, 1.5 percent for housing credits and 0.1 percent for permanent working capital.

In July this year, the central bank terminated the sunset provision in favor of thrift banks and other smaller banks and access is unified to just one rediscounting window or Rediscounting Window I (RW-I).

Releases under RW-I increased