Outstanding loans granted by Foreign Currency Deposit Units (FCDU) of banks stood at US$15.5 billion as of end-March 2023, a decrease of US$324 million or by 2.1 percent from the end-December 2022 level of US$15.8 billion as principal repayments exceeded disbursements.
The decline in FCDU loans may be attributed to: (a) lender banks’ tightened credit standards because of reduced tolerance for risk and uncertainty in economic outlook; (b) reduced demand for FCDU loans of resident exporters; (c) foreign exchange volatility and rising borrowing costs; and (d) availability of other sources of funding.
Year-on-year, outstanding FCDU loans decreased by about US$507 million or by 3.2 percent from the end-March 2022 level of US$16.0 billion.
As of end-March 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 78.4 percent of total, slightly higher than 78.3 percent from the previous quarter.
FCDU loans granted to residents comprised 60.7 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 26.1 percent); merchandise and service exporters (US$2.3 billion or 25.0 percent); and towing, tanker, trucking, personal and other industries (US$1.2 billion or 12.6 percent).
Gross disbursements in the first quarter of 2023 reached US$17.0 billion and were 20.2 percent higher than the previous quarter’s US$14.2 billion mainly due to the increase in funding requirements of a foreign bank branch affiliate.
Similarly, loan repayments in the reference quarter aggregated US$17.4 billion, a 23.4 percent increase from the previous quarter’s US$14.1 billion. These resulted in overall net principal repayment.
FCDU deposit liabilities reached an all-time high of US$48.7 billion as of end-March 2023, higher by US$879 million (or by 1.8 percent) from the end-December 2022 level of US$47.8 billion.
The bulk of these deposits (US$47.5 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 5.2 percent) from the end-March 2022 level of US$46.3 billion.
