By Julito G. Rada | May. 21, 2014 at
12:01am [ manilastandardtoday.com ]
Banks’ exposure to the real estate
sector topped P1 trillion for the first time last year and breached the
20-percent limit set by the Bangko Sentral, as more property developers took
out loans to start new residential and commercial projects.
The Bangko Sentral said real estate
exposure of universal, commercial and thrift banks hit P1.006 trillion as of
the fourth quarter of 2013, up 7.1 percent from P939.8 billion in the third
quarter.
The figure represented 21.8 percent of
the banks’ total loan portfolio, exceeding the 20-percent limit set by the
Bangko Sentral. The regulator requires
banks to observe an aggregate limit on real estate loans to not more than 20
percent of their respective total loan portfolio in a bid to reduce risks.
The Bangko Sentral said it “monitors
various segments of the credit market in its continuing effort to assess and
address potential concerns that may undermine the stability of the financial
system.”
Data from the Bangko Sentral, however,
showed that real estate loans represented only 83.8 percent of the banks’ real
estate exposure in the fourth quarter.
These loans grew 7 percent only a quarterly basis to P843 billion from
P788 billion in the third quarter.
“Sixty percent of the RELs was granted
to commercial entities such as land developers and construction companies while
the rest of the RELs was extended to borrowers acquiring residential
properties,” the Bangko Sentral said.
Investments in real estate securities
increased 7.8 percent to P163.6 billion as of end-2013 from P151.8 billion in
the third quarter. Investments in RE
securities comprised the remaining 16.2 percent of the real estate exposure.
Bangko Sentral said non-performing real estate loans remained
manageable amid the increase in real estate credit. Non-performing real estate
loans accounted for 2.8 percent of the total real estate loans.
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