Rediscount loans drop

LOANS taken out by banks from the central bank’s rediscount window fell in September from the previous month, central bank data showed.

Peso rediscount loans reached P2.1 billion last month, albeit lower than the P8.921 billion borrowed in August, the Bangko Sentral ng Pilipinas (BSP) reported on Thursday.

Total availments from January to September totalled P118.674 billion, surging from the P30.623 billion borrowed in the same period last year.

Through the rediscount window, the BSP lets banks get hold of additional money supply by posting their collectibles from clients as collateral.

In turn, the banks may use the fresh cash — whether in peso, dollar or yen — to disburse more loans for corporate or retail clients and service unexpected withdrawals.

In a statement, the BSP said bulk of the loans during the ninemonth period were used to fund other credits, amounting to 64.11%

of the total, made up of capital asset expenditures (39.88%), loans to other services (20.20%), permanent working capital (3.98%) and housing loans (0.05%).

Meanwhile, commercial credits accounted for a 35.88% share in the total borrowings, which banks used for importation (25.66%) and trading of goods and products (10.21%).

Production credits cornered 0.01% of the total and went to loans for agricultural production.

RATES

Meanwhile, for October, rediscount rates stand at 4.5625% for peso loans maturing in 90 days or less, while those with a 91- to 180-day term are priced at 4.625%.

These are based on the latest available BSP overnight lending rate plus a premium.

On the other hand, dollar credit lines come are a bit lower at 4.08513% for one- to 90-day loans; 4.14763% for 91- to 180-day loans; and 4.21013% for 181- to 360-day loans.

Rates for yen loans are at 1.92867% for one to 90-day loans; 1.99117% for 91- to 180-day loans; and 2.05367% for 181- to 360-day loans.

These are based on the 90-day London Inter-Bank Offered Rate as of endSeptember plus 200 basis points, plus term premia.