Consumer loans of banks expand 17.36% in 2015

The Bangko Sentral ng Pilipinas ( BSP) yesterday said banks’ consumer loan portfolio increased to R997.2 billion as of the end of the third quarter in 2015, up 17.36 percent year- onyear or from R849.64 billion.

These loans are the combined consumer loans of universal, commercial and thrift banks.

On a quarter-on-quarter basis, consumer loans went up by four percent from R959.18 billion endJune last year. Quarterly growth has been sustained since 2008.

According to the BSP, consumer loans rose quarter- onquarter driven by an increase in motor vehicle loans and residential real estate loans.

As of end- September 2015, motor vehicle loans amounted to R283.56 billion, up 30.46 percent from the same period in 2014 of R217.35 billion. Quarterly, this segment improved by 9.33 percent

Residential real estate loans, in the meantime, went up by 10.12 percent to P420.17 billion from P382.25 billion while quarter- onquarter, it was up 2.88 percent.

The BSP said banks’ nonperforming consumer loans is 4.6 percent of their total consumer loans during the period. This was higher by 4.5 percent compared to the previous quar- ter ending in June.

The banks’ loan loss provisioning or “buffer for potential credit losses” stood at 60.5 percent.

The BSP said it “monitors the level and quality of consumer and other bank loans to ensure banks’ adherence to high credit standards. This is in line with the BSP’s supervisory efforts to promote sound credit risk management and financial stability.”

Banks’ overall gross nonperforming loans – and this number excludes thrift banks – stood at 1.82 percent of total loan portfolio as of end-September last year. NPLs are loans whose interests and principals are unpaid for at least 90 days. Past due loans, in the meantime, are unpaid loans for 30 to 60 days.

The BSP noted that banks’ loan quality indicator has been below two percent since November 2014.

Soured loans amounted to R95.24 billion as of end-September 2015, lower from the previous month’s R97.05 billion. Banks’ total loan portfolio, on the other hand, reached R5.24 trillion in September from the R5.21 trillion registered in August of the same year.

The central bank said compared to neighbor countries, the local banks’ consumer credit exposure, as a percentage of total loan portfolio, is considered the lowest among its ASEAN 5 peers.