Outstanding loans granted by Foreign Currency Deposit Units (FCDU) of banks stood at US$15.4 billion as of end-June 2023, a decrease of US$66 million or by 0.4 percent from the end-March 2023 level of US$15.5 billion as principal repayments exceeded disbursements.
The decline in FCDU loans may be attributed to: (a) rising borrowing costs (b) lender banks’ tightened credit standards due to reduced tolerance for risk and less desirable borrowers’ profile; (c) foreign exchange volatility; and (d) availability of other sources of funding.
Year-on-year, outstanding FCDU loans decreased by about US$317 million or by 2.0 percent from the end-June 2022 level of US$15.7 billion.
As of end-June 2023, the maturity profile of the FCDU loan portfolio remained predominantly medium- to long-term [or those payable over a term of more than one (1) year], which comprised 78.3 percent of total, slightly lower than 78.4 percent from the previous quarter.
FCDU loans granted to residents comprised 61.3 percent or US$9.4 billion of total outstanding FCDU loans, of which majority went to the following sector/industries: power generation companies (US$2.4 billion or 25.9 percent); merchandise and service exporters (US$2.3 billion or 24.4 percent); and towing, tanker, trucking, forwarding, personal and other industries (US$1.3 billion or 13.7 percent).
Gross disbursements in the second quarter of 2023 reached US$14.4 billion but were 15.6 percent lower than the previous quarter’s US$17.0 billion mainly due to the decrease in funding requirements of a foreign bank branch affiliate.
Similarly, loan repayments in the reference quarter of US$14.4 billion were 16.8 percent lower than previous quarter’s US$17.4 billion. These resulted in overall net principal repayment.
FCDU deposit liabilities reached an all-time high of US$49.0 billion as of end-June 2023, higher by about US$260 million (or by 0.5 percent) from the end-March 2023 level of US$48.7 billion. The bulk of these deposits (US$47.7 billion or 97.4 percent) continued to be owned by residents, essentially constituting an additional buffer to the country’s gross international reserves.
Year-on-year, FCDU deposit liabilities increased by US$2.4 billion (or by 5.1 percent) from the end-June 2022 level of US$46.6 billion.
