By FIL C. SIONIL
The commercial banking system’s exposure to real estate sector for the whole 2003 grew by 2.7 percent to R195 billion from the previous year’s P189.9 billion, an indication that this segment of the economy continues to be attractive.
Bangko Sentral ng Pilipinas (BSP) Governor Rafael Carlos B. Buenaventura reported yesterday that 94.1 percent of the total universal and commercial banking sector exposure to real estate represents its loans outstanding for the sector or roughly about P
183.5 billion as of end December 2003.
The balance of P11.4 billion or about 5.9 percent represents the universal banking system’s investments, which unibanks are allowed to engage as part of its non-allied business.
In particular, universal banks exposure to the real estate industry included investments in commercial papers which posted a 21.6 percent year-on-year growth to P2.8 billion and investment in equities of real estate companies which grew by 3.9 percent to P8.7 billion.
Buenaventura told reporters yesterday painted an upbeat forecast on the property sector as the economy improves further in the later part of the year.
Economic activities in the property sector will improve, Buenaventura said.
The total exposure, Buenaventura added also accounted for 6.5 percent of the combined total loans, but, exclusive of interbank loans (IBL) and investment portfolio of commercial/universal banks for the period in review.
Year-on-year comparison showed that the real estate loans otherwise known as RELs registered an expansion of 2.4 percent from P179.2 billion.
On the other hand, the ratio of RELs to total loans, exclusive of IBL, was contained at 11.8 percent against 11.9 percent a year ago, since total loans, exclusive of IBL, had a higher growth rate of 3.4 percent, he explained.
Furthermore, Buenaventura reported that commercial RELs amounted to P151.5 billion, corresponding to 82.6 percent of total RELs. This level is higher by about R4.5 billion or 3.1 percent from R147.0 billion last year.
Residential RELs, meanwhile, aggregated to R32.0 billion or 17.4 percent of total, an inching of 0.7 percent or P200 million lower from P32.2 billion a year ago.
Past due REL ratio improved by 2.4 percentage points to 21.7 percent from 24.1 percent last year as past due RELs declined by 7.7 percent to P39.8 billion. It was noted that past due ratio of residential RELs inched up from 14.8 percent last year to 15.6 percent.
This, however, is much lower than the past due ratio of commercial RELs which nonetheless went down from 26.1 percent to 23.0 percent.
