Loans given by Philippine banks’ foreign currency deposit units increased 23 percent year-on-year to $7.768 billion as of end-June.
The increase was caused by the continued low rate environment.
In the previous quarter ending in March, FCDU loans rose only 7.3 percent.
The BSP explained that loan transactions resulted in excess disbursements over repayments of $527 million during the period. It noted that positive macroeconomic conditions, strong consumer confidence and the low interest rates are contributing to net disbursements of dollar-denominated loans.
Private sector borrowers took up majority of FCDU loans with 83.3 percent or $6.5 billion, higher than the previous quarter’s $5.9 billion.
The overall loans-to-deposits ratio increased to 30.2 percent from 28.8 percent in March, said the BSP.
FCDUs are units of a local bank or of a local branch of a foreign bank authorized by the BSP to engage in foreign currency-denominated transactions.
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