Connect with us

Hi, what are you looking for?

Economy

Quasi-lenders’ loan portfolio drops in 1st half

THE LENDING portfolio of nonbank financial institutions with quasi-banking functions (NBQBs) dropped in the first half of the year as players merged or gave up their licenses, an official from the Bangko Sentral ng Pilipinas (BSP) said.

“As of end-June 2020, the NBQBs’ total loan portfolio (TLP) dropped by 33.6% year on year to P133.4 billion following merger and/or surrender of QB license of certain entities resulting from a review of strategic direction and business operations,” BSP Managing Director for Policy and Specialized Supervision Lyn I. Javier said in an e-mail.

Quasi-banks include financing companies and investment houses.

This also affected total operating income of NBQBs, which plummeted 70.8% to P3.9 billion.

“The decline is also partly influenced by the drop in non-interest income, particularly trading income,” Ms. Javier said.

Like their bank counterparts, quasi-lenders also saw a higher nonperforming loan (NPL) ratio amid the impact of the pandemic. The industry’s NPL ratio picked up to 5.8% as of end-June from 4.4% a year ago.

“The current NPL ratio is higher than the Philippine banking system’s estimated NPL ratio of 4.6% by end-December 2020.  Nevertheless, we expect that the NBQB’s NPL ratio will remain manageable in the next two years,” Ms. Javier said.

The Philippine banking system’s bad loan ratio stood at 3.4% as of end-September, already the highest since the 3.42% NPL ratio logged in May 2013.

The BSP will remain watchful of the NPL ratio of quasi-lenders amid the current crisis, said Ms. Javier.

“The NBQB industry is expected to remain stable as most of the financing companies and investment houses with QB license are linked with universal and commercial banks hence, governed by the same set of risk management standards,” she said. — L.W.T. Noble

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

Unemployment rate steadied in June, while job quality improved to its best in over a year, the Philippine Statistics Authority reported on Monday. Preliminary...

Economy

Follow us on Spotify BusinessWorld B-Side By Patricia B. Mirasol, Reporter speaking to Bernardo M. Villegas WITH EVERY CHANGE of administration comes the question of...

Economy

In line with the national government’s thrust to transform the Philippines through PPPs and collaboration between LGUs and the private sector, Iloilo City Mayor...

Economy

Click to enlarge. Click to enlarge.   Spotlight is BusinessWorld’s sponsored section that allows advertisers to amplify their brand and connect with BusinessWorld’s audience...

Economy

As the Aboitiz Group embarks on a Great Transformation towards becoming the first “techglomerate” in the country by 2025, the company’s power arm is...

Economy

Security Bank Corporation (PSE: SECB), one of the Philippines’ leading universal banks, has been serving retail, corporate, institutional, and MSME clients since it opened...

You May Also Like

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Economy

Ivermectin, an existing drug against parasites including head lice, has had a checkered history when it comes to treating COVID-19. The bulk of studies...

Investing

Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Investing

Instagram still holds the top spot for social media in terms of building brand reputation and expanding business potential. Every day, more and more...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.