Bad loans inch higher amid natural calamities

Philippine banks’ bad loan ratio increased to 3.33 percent as of end-October as a string of typhoons and earthquakes disrupted working days and weakened borrowers’ ability to settle debts.

- BY DERCO ROSAL

The latest data from the Bangko Sentral ng Pilipinas (BSP) showed that the banking industry’s nonperforming loan (NPL) ratio worsened in October from the 3.31 percent recorded in the previous month.

Despite the uptick, the October bad loan figure remained lower than the 3.5-percent peak seen in August this year. It was also lower than the 3.6 percent posted in the same month last year.

Bad loans inched down by 0.4 percent to P537 billion as of end-October from P538.9 billion in September. Year-on-year, soured loans increased by 2.4 percent from P524.3 billion in October last year.