Foreign currency loans extended by Philippine banks up 11.6% in June

Low interest rates attracted borrowers.

Foreign currency loans extended by banks in the Philippines rose 11.6% YoY to $336.55m (PHP17.5b) by end-June from $301.93m (PHP15.7b) in the same period last year as borrowers took advantage of low interest rates, according to central bank data cited by Philippine Star. 

Foreign currency loans issued as of end-June also rose 4% from the end-March level of $16.8b.

The maturity mix of the banks' loan portfolio leaned toward medium to long-term debt which accounted for 78.1% of total, up from last year's 75.6%.

The lion's share of outstanding loans went to towing, tanker, trucking and forwarding with 23.7%, merchandise and service exporters with 16.4%, public utility firms with 8.3% and producers or manufacturers including oil companies with 4.3%.

Foreign currency deposit units are allowed by the central bank to conduct transactions involving foreign currencies, including accepting deposits and extending loans.