Published : Saturday, May 05, 2012 00:00 [ manilatimes.net ]
Written by : RAFFY AYENG
CORRESPONDENT
AFTER the closure of Export and
Industry Bank that left about 50, 000 depositors in its 51 branches nationwide
in agony, the Finance Department reiterated that private banks in the country
are still in good shape.
But Finance Secretary Cesar Purisima,
also a member of the Bangko Sentral ng Pilipinas (BSP) policy-making Monetary
Board, said in a statement that they are watching banks that are exposed to the
real estate sector.
“Right now, we believe it is still within
manageable levels. As of end-December 2011, the combined exposure to the real
estate sector of universal and commercial banks [U/KBs] and thrift banks [TBs]
breached the half trillion mark and reached the highest level at P518.6
billion,” he added.
Meanwhile, the BSP said that the
exposure expanded by 6.8 percent from the third quarter of last year, when the
level was at P485.6 billion, but compared to end-2010 figures, the expansion
was 19.6 percent from P433.6 billion.
“Additional exposure during the
quarter came exclusively from real estate loans, which grew by 7.2 percent to
P505.9 billion. By industry, a significant portion of the exposure was held by
U/KBs at 76.7-percent [P397.6 billion] share while the remaining 23.3 percent
[P121.0 billion] was accounted for by the thrift banks,” the BSP added.
Recently, Columbia University
economist Jeffrey Sachs said in an Asian Development Bank (ADB) forum that the
short-term management of the real estate sector would be a challenge.
“It is a delicate balance between
creating bubbles which is a tendency to turn on the liquidity when there is a
slowdown. Asia needs to make sure that its own banks are not creating their own
bubbles . . . Banks are very important but they run away given any leeway at
all. They are gambling with other people’s money, paying the short-term
benefits, leaving the long-term losses,” Sachs explained.
ADB president Haruhiko Kuroda
supported Sachs’ statement, saying that even the advanced economies of Japan,
Europe and the United States had difficulties in spotting bubbles and
addressing them.
“I felt that a lot of lessons can be
learned from the experiences of the United States, eurozone and Japan. Those
economies have attained significant development. Still, they made many
mistakes,” Kuroda said during the forum.
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