FCDU loans down 10.6% to $4.046B

The outstanding loan portfolio of foreign currency deposit units (FCDUs) of banks declined by 10.6 percent to $4.046 billion for the whole of 2005 due to the disposition of non-performing loans to special purpose vehicles.

On a quarter-by-quarter basis, the BSP said that as of end-December 2005, the outstanding loan portfolio of the FCDU system declined by 1.6 percent compared to the previous quarter ending September.

The BSP said loan releases during the period of October to December 2005 reached $1.286 million, posting a growth of 27 percent from the previous quarter’s level.

Loan repayments, on the other hand, declined by 14 percent to $1.269 billion, resulting in an overall net availment of $17 million from a net repayment of $469 million in the previous quarter.

Therefore, the BSP said the decline in FCDU loan portfolio in the last quarter of 2005 was due to negative adjustments totaling $82 million which came from the lower dollar value of third-currency denominated loans.

The negative adjustment resulted from the strengthening of the dollar against other currencies, and the transfer/sale of certain loans to Special Purpose Vehicles/offshore banks.

Private sector accounts comprised 61 percent of outstanding FCDU credits. In terms of maturity profile, the ratio of short-term loans to medium and long-term accounts stood at 29:71, reflecting a slight shift from the 28:72 mix a year ago. Exporters and public utility enterprises remained as the major beneficiaries, accounting for a combined 40- percent share of total.