Philippine banks' real estate exposure grows in Q2

It accounted for nearly a fifth of total loans in June.

Philippine banks saw their exposure to the real estate sector rise in Q2 after eight straight quarters of decline, according to central bank data cited by Philippine Star. 

The proportion of real estate loans to the industry’s total loan book rose to 19.5% of total loans in June from around 19% in March although the headline figure is still lower than the central bank's prescribed 20%. 

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Systemwide real estate loans have grown at a compound annual growth rate of 22% over 2012-2017 versus slower system loan growth of 17% over the same period, according to a 2018 report from Fitch. 

Despite growing loan exposure to the real estate sector, asset quality remained healthy with gross non-performing loans in the real estate segment dropping by 1.74% in June from 1.79% in the same period last year.