LOANS sought by local government units (LGUs) fell by 65.42% as of end-November, the Bureau of Local Government Finance (BLGF) reported.
Loan requirements of LGUs reached P31.06 billion in the 11-month period, lower than the P89.83 billion posted in the same period a year earlier.
Debt applications are extracted from the BLGF-issued certificates of net debt service ceiling and borrowing capacity, of which 163 were released during the period, including seven amendments.
These certificates were issued to 120 municipalities, 31 cities, four provinces, and eight barangays.
Cities applied to borrow P13.572 billion, followed by municipalities (P12.59 billion), provinces (P4.83 billion), and barangays (P74 million).
The certifications are a leading indicator for the borrowing intentions of local governments, whose capacity for taking on debt must be certified by the BLGF, a unit of the Department of Finance.
In the 11 months ended November, LGUs’ total borrowing capacity was P79.343 billion, 66.74% lower than the P238.54 billion from a year earlier.
Cities had a borrowing capacity of P40.46 billion, followed by municipalities (P32.78 billion), provinces (P6.05 billion), and barangays (P57.27 million).
In November, the BLGF released 25 certifications to LGUs, with no amendments, covering proposed loans worth P4.885 billion, lower by 31.37% from the P7.118 billion a year earlier.
During the month, 19 certificates were issued to municipalities, five to cities, and one to a barangay.
“Municipalities had the highest total loan requirement of P2.672 million while cities had the highest borrowing capacity of P9.109 billion,” the BLGF said.
Mabalacat City, Pampanga was the leading availer of loans in November with P610 million, followed by Cotabato City with P575 million and Dipolog City, Zamboanga del Norte with P500 million. — L.M.J.C. Jocson