RCBC home loan portfolio up 61% in H1

CEBU, Philippines —  The Rizal Commercial Banking Corp. (RCBC) reported a 61 percent increase of its home loan portfolio as the market’s confidence eases up.

In the first six months of 2021, RCBC logged P60.1 billion housing loan portfolio, a four percent improvement from P57.9 billion in December 2020. The bookings however are up 61 percent year-on-year, said RCBC consumer lending group head Ramil M. De Villa

De Villa attributed the positive growth of their home loans portfolio to easing of restriction, start of the vaccination roll out, and the bank’s sensitivity to the challenges of its borrowers.

Easing of restrictions enabled construction operations to resume and economic activity to pick-up.

Another positive factor was the speed of the vaccination program which resulted to more people returning to work, thus generating funds for the downpayments or new loans.

De Villa pointed out that 70-percent of RCBC’s home loans portfolio come from overseas Filipino workers (OFWs) while 30 percent from domestic borrowers, “which means business as usual.”

“OFWs returned to work abroad because of the vaccination program and easing restriction here and their respective host countries. So that allowed the bank to start drawing down (from the loans),” he added.

That is because the Yuchencgo-led universal bank assumed the position of not foreclosing home loans but rather offering various safety packages.

RCBC introduced Covid19 Assistance Recovery Enhancement Program (CARE), which offers a moratorium, wherein the borrower can resume payment after six months, a repackaging of amortization, or even a restructuring of payments and terms.

Most banks have lowered their lending rates and offered a slew of restructuring and re-pricing programs for their borrowers. They are also hurdling challenges in the processing of loan applications to better help clients get their documentary approvals.

RCBC offers a competitive six to 6.5 percent lending rate for the newly-booked home loans.

De Villa admitted that their non-performing loan on home loans rose to almost 10 percent in 2020, as most financial institutions bore the brunt by keeping healthy reserves on portfolios.

He, however expressed confidence that it will be lowered to six to seven percent by the end of 2021, buoyed by a clean-up of the bank’s portfolio as government agencies and the courts are opening up again to process necessary housing requirements and even annotate and register mortgages.

“We are confident that we will end up by 6 to 7 percent on home loans by the end of the year,” he concluded.

The CLG (consumer lending group) comprises 20 percent of the whole RCBC portfolio. Broken down, housing loans comprised P60.1 billion or 57.1 percent, auto loans at P43.7 billion or 41.5 percent, and personal loans at P1.4 billion or 1.4 percent.