BSP rediscount availments down 82% in Q1

Fewer banks took out loans under the Bangko Sentral ng Pilipinas’ rediscount facilities as of end- March as they had enough liquidity for their funding needs.

The central bank said Friday availments under the peso rediscount facility slipped 82 percent to P75 million in the first quarter from P412 million in the same period last year.

These loans were made to fund commercial credits, production credits, and other credits such as housing, capital expenditure, and permanent working capital, the BSP said.

Rediscount facilities allow banks to borrow from the BSP to meet short-term liquidity needs. Banks use their clients’ promissory notes as collateral when availing from these facilities.

BSP data also showed availments under the dollar rediscount facility amounted to $ 400,000 in the first quarter, down by 79 percent from the $ 1.9 million grants in the same period last year.

The central bank said this borrowing was made by a central bank and benefitted one exporter.

Meanwhile, there were no borrowings under the yen rediscount facility during the first quarter of the year, nor for the same period in 2014.

Fewer availments under the rediscount facilities reflect the banks’ adequate liquidity levels to service the needs of their clients and to allocate funds to act as buffer against external shocks.

The local banking system grew its resources by 12 percent to P11.52 trillion in end- 2014 from P10.31 trillion in 2013.

The BSP said the expansion in resources was amid the growth in loans, financial assets, and equity investments.

Universal and commercial banks held 90 percent of the resources at P10.4 trillion, while thrift banks had P916.2 billion. Rural banks, meanwhile, accounted for P209 billion.