Banks' bad loans ratio eases to two-year low

The soured loans of Philippine banks continued to ease in December last year, hitting the lowest level in two years, as improved borrower repayment capacity and sustained economic activity helped reduce defaults.

- KEISHA TA-ASAN

Preliminary data from the Bangko Sentral ng Pilipinas (BSP) showed the banking industry's non-performing loan (NPL) ratio improved further to 3.27 percent in December from 3.54 percent in November.

NPLs refer to credit obligations that have not been repaid for at least 90 days past their due date. These loans are categorized as high-risk assets because they indicate a borrower's diminished ability or willingness to meet their financial obligations.