Manila Bulletin

BSP rediscount­ing totals P26.9 billion at end-September

- By LEE C. CHIPONGIAN

The central bank’s peso rediscount­ing facility increased to R26.9 billion or up R6.2 billion as of end-September compared to R20.7 billion end-August.

The rediscount­ing releases were however lower than same period last year of R118.67 billion.

The Bangko Sentral ng Pilipinas (BSP) has been reporting an unmoving rediscount­ing number of R20.7 billion since April this year. The banking system was awash with liquidity after the BSP injected R1.5 trillion of liquidity by end-September. This is now further increased to R1.9 trillion as of the first week of October after the central bank advanced R540 billion to the National Government to finance the budget deficit.

For the January to September period, rediscount­ing availments represent borrowings against banks’ credits on transactio­ns related to commercial and other credits.

The BSP said other credits accounted for 81.94 percent of the total rediscount­ing loans during the period. These are broken down as: 71.26 percent bank loans for capital asset expenditur­es; 10.67 percent permanent working capital; and 0.01 percent for housing.

Commercial credits, on the other hand, accounted for 18.06 percent of the total rediscount­ing loans pertain. These are bank loans for importatio­n with a share of 10.93 percent and trading of goods with 7.13 percent.

There were still zero availments for the Exporters’ Dollar and Yen Rediscount Facility (EDYRF).

The BSP has extended the temporary reduction of the term spread on peso, US dollar and Japanese yen rediscount­ing loans until January 31, 2021 as “part of the BSP’s measures to continuous­ly provide the needed liquidity to banks for purposes of maintainin­g price and financial stability as the economy recovers from the effects of the coronaviru­s disease” in the country.

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