Banks’ FCDU loans slip as of March

OUTSTANDING LOANS granted by banks’ foreign currency deposit units (FCDU) went down at end-March as loans to nonresidents dropped, data from the Bangko Sentral ng Pilipinas (BSP) showed.

FCDU loans were at $15.439 billion as of March, declining from $15.782 billion in the comparable year-ago period and $15.561 billion at end-December, the central bank said on Tuesday.

FCDUs are units of domestic banks or local branches of foreign banks authorized by the BSP to service transactions involving foreign currencies, including deposits and loans.

Resident and nonresident borrowers, including individuals and businesses like importers, use these loans for their foreign currency payables or needs.

“As of end-March 2026, outstanding loans reflected $8.25 billion in new loans and $8.36 billion in loan payments made during the reference quarter,” the central bank said.

Some $10.443 billion or 67.6% of outstanding foreign currency loans went to Philippine-based borrowers, which were all extended to private sector entities. This was up from $9.909 billion a year ago and $10.391 billion as of December 2025.

These included merchandise and service exporters with $2.75 billion or 26.4% of the total; towing, tanker, trucking, forwarding, personal and other industries with $2.51 billion or 24%; and power generation companies with $1.85 billion or 17.7%, the central bank said.

Meanwhile, FCDU loans to nonresidents stood at $4.996 billion at end-March, making up 32.4% of the total. This was down from $5.872 billion in the previous year and $5.17 billion at end-December.

The BSP added that $11.91 billion or 77.1% of the end-March outstanding loans have medium- to long-term maturities, or those payable in a year or more. This was lower than $12.182 billion a year ago (77.2% of the total) and $12.318 billion (79.2%) in the prior quarter.

Short-term loans totaled $3.529 billion, accounting for 22.2% of the total. This was below the $3.6 billion (22.8% of the total) recorded in the prior year, but was higher than the $3.243 billion (20.8%) recorded as of December.

By creditor, local banks granted 83.5% of the outstanding FCDU loans at end-March with $12.891 billion. Of this, $12.867 billion came from commercial banks, while $24 million was disbursed by thrift banks.

Foreign bank branches or subsidiaries extended $2.548 billion or 16.5% of the loans during the period.

Meanwhile, banks’ FCDU deposit liabilities rose to $60.769 billion as of March from $59.828 billion at end-December and $58.919 billion in the prior year.

This brought the overall FCDU loans-to-deposits ratio to 25.4%, down from 26% as of December and 26.8% in the previous year. — Bettina V. Roc