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No rediscount borrowings in November

BANKS did not touch the rediscount facility of the Bangko Sentral ng Pilipinas (BSP) in November amid ample liquidity and relatively slow lending growth.

“For the period Jan. 1 to Nov. 30, total availments of banks against their rediscount loans remain unchanged at P6.12 million for loans under the peso rediscount facility,” the central bank said in a statement on Friday.

There were also no availments under the Exporters’ Dollar and Yen Rediscount Facility (EDYRF).

The BSP’s rediscount facility gives banks access to additional money supply by posting their collectibles from clients as collateral.

In turn, banks may use the cash — denominated in peso, dollar or yen — to extend more loans to their corporate or retail clients and service unexpected withdrawals.

In 2021, lenders have so far only tapped the central bank’s rediscount facility in June, July, and September.

Lenders did not borrow from the rediscount facility in November as they have ample liquidity and lending growth remains muted, Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said in a Viber message.

“Banks also have other options for funding such as the interbank market and the capital markets,” he added.

Outstanding loans by big banks rose 3.5% year on year to P9.268 trillion in October, based on latest BSP data. Production loans rose 4.9%, while retail borrowings dropped by 7.2%.

In the same month, liquidity growth slowed to 8.2% from 8.3% in September.

Meanwhile, for December, the applicable rate for peso rediscount loans will be 2.5%, regardless of maturity.

Rates of dollar- and yen-denominated loans, regardless of maturity, are at 2.17325% and 1.91533%. – L.W.T. Noble

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