A report by the Bangko Sentral ng Pilipinas announced the overall assessment of the health of the banking systems in 2015. It stated that the domestic banks performed reasonably well due to adequate time deposits and savings which were the major source of funds,
An amount of P7.3 trillion was deposited exhibiting an increase of P0.6 as against 2014; this translates to a growth of 8.9%. The increase in the last quarter was 7.5%.
The “savings and demand” deposits rose 12.4% and 17.1 percent as against the results of the year-and-quarter-ago; this was revealed by The Report on Economic and Financial Developments for the fourth quarter.
But, time deposits dipped by P72.9 billion amounting to 3.9% although deposits of foreign currency by residents grew to P1.5 Billion, an increase of 8.3% year-on-year.
Net of banks’ RRP placements with Bangko Sentral, showed the Dec 2015 outstanding loans of commercial banks rising by 13.6 % as against 2014; it was 12.6% for the previous quarter.
The lending including RRPs, showed a 12.7% increase as against end-2014. The double-digit increase of the loans of commercial banks is rising steadily since January 2001
Since 2011 the double-digit increase of Commercial banks’ loans continues to increase; this growth in lending helped expand productive sectors in the fourth quarter of 2015, Bangko Sentral said.
Production loans that are 80% of all loans rose by 13.7% due to higher real-estate lending;
- Electricity/gas/air-conditioning loans 19.5%,
- Wholesale/retail trade 27.5%,
- Cars/motorcycles repairs 12.6%,
- Financial and insurance activities 12.3%
- Information and communication 27%.
There was also a spurt in lending to sectors other than the social and personal and the administrative and support services sectors which dipped 5.2% and 1.8%.
Household consumption Loans grew 15.1% riding on growth in motor vehicle loans, salary-based general-purpose loans etc.
The banking resources grew by 7.9% to P12.4 trillion as on end-2015 from the previous year’s P11.5 trillion. Total resources were thus 93.7% of the GDP 90% of which was contributed by universal and commercial banks.
The gross NPAs were 2.1% as of end-December 2015, a marked improvement as against 2.3% corresponding to a year-and-quarter-ago.
Author: Umrao Singh
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