The bank takes advantage of the P7.52-B rediscount loan


A LONE BANK tapped the Bangko Sentral ng Pilipinas (BSP) peso rediscount window in June after the facility was left untouched last month.

A universal bank took out a loan of 7.52 billion pula from the BSP’s Peso Rediscount Facility in June, according to central bank data. This followed his loan of 4.08 billion pesos in April.

The two loans from the lender accounted for the 11.6 billion pesos of total drawdowns under the peso rediscount window for the first half.

In 2021, lenders only tapped the facility in June, July and September. These rediscount loans in pesos amounted to 6.12 million pula.

“These installments are secured by the bank’s credit instruments arising from trade and other credits, as permitted under Article 282 of the Banking Handbook,” the BSP said.

“The other credits, which represent 97.72% of the total availability, represent the rediscount of the loans which financed the capital expenditures, while the remaining 2.28%, under trade credits, represent the rediscount of the loans which financed the import activities.”

Meanwhile, the Exporter Dollar and Yen Rediscount Facility (EDYRF) sat idle for the past month. The last time recourse was made under the EDYRF was a dollar rediscount loan in 2016, the BSP said.

The BSP Rediscount Window allows banks to access additional money supply by depositing their collectibles with customers as collateral.

In turn, banks can use the liquidity – denominated in pesos, dollars or yen – to extend more loans to their businesses or retail customers and to make unscheduled withdrawals.

Bank lending growth hit a two-year high in May as economic activity continued to recover and borrowers secured funding amid rising interest rates, with liquidity also supporting its expansion.

The latest data from the BSP showed that the outstanding loans of major banks, net of reverse repurchase investments with the central bank, increased by 10.7% in May to reach 9.97 trillion pesos in the same month. from last year.

This is the fastest loan growth seen in 24 months or since the 11.2% expansion recorded in May 2020.

As loan growth continued to accelerate, domestic liquidity rose 6.9% to 15.3 trillion pesos in May. That was slower than March’s revised 7.2% growth.

For the month of July, the rate applicable to rediscount loans in pesos will be 3.3969% for 90 days to maturity and 3.7938% for 91 to 180 days.

Meanwhile, dollar borrowings will be priced at 4.68204% (1-90 days), 5.07894% (91-180 days), 5.87274% (181-360 days).

Yen-dominated borrowings will be priced at 2.3658% (1-90 days), 2.7627% (91-180 days), 3.5565% (181-360 days). — KB Ta-asan

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