Banks' NPL ratio ease to 2.95% in April - BSP

The soured loans ratio of universal and commercial banks remained at a low 2.95-percent level for the third straight month in April, the Bangko Sentral ng Pilipinas (BSP) reported on Friday. According to the central bank, the non-performing loans (NPL) ratio of banks improved from the revised 3.34 percent in the same period in 2010, and was lower than the 2.99 percent March level. Loans given by universal and commercial banks rose by 11 percent to P2.83 trillion in April, or 2.6 percent higher than the figure in March. The industry's non-performing loans, meanwhile, declined by 1.95 percent to settle at P83.44 billion from the P85.1 billion year-ago figure. Similarly, non-performing assets (NPA) fell by 5.2 percent in the period, settling at P205.37 billion. Gross assets of banks, on the other hand, continued to see double-digit growth of 10.2 percent to P6.14 trillion in the period, compared with last year's figures of P5.57 trillion. Likewise, loan loss reserve (LLR) of banks jumped 8.7 percent to P101 billion in April, the BSP said. "The industry provided adequate provisioning against potential credit losses," it added. Latest data showed that earnings of universal and commercial banks increased by about 17 percent to P21.65 billion in the first quarter of the year, on the back of the industry's strong interest and non-interest income. Data also showed interest income of the industry improved by 2.5 percent to P69.89 billion in the first quarter of the year, while non-interest income inched up by 1.1 percent to P25.51 billion from P25.23 billion in the same period last year. On the other hand, the industry's interest expense climbed by 4.9 percent in the period, while non-interest expense went up by 4.1 percent to P46.49 billion from P44.67 billion year-on-year. — JMT/OMG, GMA News