BANKS TOOK more loans out of the central bank’s rediscount window in February, with the amounts poured into capital purchases and import payments.
Peso rediscount loans reached P20.433 billion last month, rising from the P14.462 billion borrowed in January, the Bangko Sentral ng Pilipinas (BSP) announced yesterday. This is also higher than the P5.81 billion in credit lines secured in February last year.
The central bank’s rediscount facility lets banks get their hands on additional cash by accepting a lender’s collectibles as collateral for short-term credit. The banks can then use the fresh money supply — either in peso, dollar or yen — to hand out more loans for corporate or retail clients, as well as service unexpected withdrawals.
In a statement, the central bank said bulk of the borrowings were meant to support capital asset spending, which took 40.61% of the sum. This is followed by import requirements which took roughly a third of the sum, followed by permanent working capital (11.92%), goods trading (10.85%), and loans to real estate and other business activities (5.44%).
These brought the two-month rediscount tally to P34.895 billion.
The bigger rediscount lines come at a time when some industry players flag tighter money supply in the system. However, central bank officials have repeatedly said that the liquidity conditions remain ample. BSP Deputy Governor Diwa C. Guinigundo has said that the weekly oversubscriptions in their term deposit auctions show that banks are still sitting on excess cash.
Meanwhile, the dollar and yen rediscount window meant for exporters stood untouched, much like the trend observed for the past few years.
For this month, rates for rediscount loans remain steady after policy makers voted to keep benchmark yields unchanged during February’s rate-setting meeting.
Rediscount rates for peso loans stand at 5.3125% for loans maturing in 90 days or less, while those with a 91 to 180-day maturity are priced at 5.375%. These are based on the 5.25% ceiling of the interest rate corridor plus a premium.
The Monetary Board will conduct their second policy meeting next week, which will be led by new BSP Governor Benjamin E. Diokno.
Yields for foreign currency loans saw mixed movements, reflecting trends in global interest rates.
Dollar credit lines will come with an even lower rate of 4.61513% for one to 90-day loans; 4.67763% for 91- to 180-day loans; and 4.74013% for 181- to 360-day loans, the BSP said.
On the other hand, the rates for yen debts went up to 1.92167% for one to 90-day loans, 1.98417% for 91- to 180-day loans, and 2.04667% for 181- to 360-day loans. — Melissa Luz T. Lopez