Mindanao rural, coop banks have lowest non-performing loans

Jul. 13, 2007

DAVAO CITY — Rural and cooperative banks (R/CBs) in Mindanao have the lowest non-performing loans NPL) as of the first quarter of 2007.

The Bangko Sentral ng Pilipinas (BSP) reported that the Mindanao R/CBs posted a 9.03 percent ratio although a slight increase was noted from last quarters 8.9 percent.

However, compared to the other major geographical regions, Mindanao remains the lowest where Luzon R/CBs posted 11.30 percent while Visayas at 11.97 percent. The report further stated that the ratio decrease from the previous quarter with 11.40 percent for Luzon and 12.25 percent for the Visayas R/CBs non-performing loans.

Overall NPL ratio as of end March 2007 for R/CBs was pegged at 10.96 percent which is in its third consecutive quarter of improvement in ratio from 11.07 percent at end-December 2006, 11.63 percent at end-September 2006 and 12.07 ratio at end-June 2006.

It said that the quarter-on-quarter improvement was driven by the sustained growth of the industrys loan portfolio. Total loan portfolio (TLP) expanded by 1.90 percent, outpacing 0.88 increase in NPLs.

Meanwhile the ratio of restructured loans (RLs), gross to TLP, gross rose to 1.27 percent from last quarters 1.04 percent brought on by the 24=25 percent increase in RLs, gross to P1.06 billion from P0.86 billion last quarter.

The NPL coverage ratio favorably climbed to 35.44 percent from 35.23 percent last quarter. This developed as loan loss reserves (LLRs) grew by 1.50percent to P3.23 billion, outpacing the growth in NPLs. (PIA XI/prixdbanzon).

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