February 2, 2023

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FCDU outstanding loans decline slightly in September

OUTSTANDING loans originated by banks’ Foreign Currency Deposit Units (FCDU) declined slightly to $15.67 billion by the end of September, down $44 million, or 0.3 percent, from where they were Equivalent to $15.71 billion at the end of June 2022.

The central bank said the decline in FCDU lending could be due to the gradual easing of lending parameters and the net tightening in overall lending standards by lending banks, leading to unchanged or intentional lending and lending activity amid uncertainty over the economic outlook. Adding to this is the lower borrower demand for FCDU loans amid exchange rate volatility and rising borrowing costs.

Year-over-year, FCDU loans outstanding decreased $164 million, or 1 percent, from $15.8 billion at the end of September 2021.

At the end of September, the maturity profile of the FCDU loan portfolio continued to be predominantly medium to long term debt[orthosepayableoveratermofmorethanoneyearwhichrepresented78percentofthetotalamount[orthosepayableoveratermofmorethanoneyearwhichcomprised78percentoftotal[odersolchendieübereineLaufzeitvonmehralseinemJahrzahlbarsindwas78ProzentdesGesamtbetragsausmachte[orthosepayableoveratermofmorethanoneyearwhichcomprised78percentoftotal

FCDU loans granted to residents accounted for 63 percent of total outstanding FCDU loans. Of the $10 billion in outstanding loans to residents, most went to power generation companies at $2.7 billion, or 27 percent; exporters of goods and services at $2.4 billion, or 24 percent; and 1 $.2 billion or 12 percent to management/holding and brokerage.

Gross disbursements for the third quarter of the year were $14.6 billion, down 6 percent sequentially, primarily due to a decrease in the funding needs of a subsidiary of a foreign bank. Loan repayments in the same quarter, meanwhile, reached $14.6 billion, down 8 percent sequentially. These resulted in an overall net payout.

FCDU deposit liabilities were $45.8 billion at the end of September, down $838 million, or nearly 2 percent, from the end-June level of $46.6 billion.

The bulk of these deposits, or about 97 percent, remain held by residents, essentially providing an additional buffer to the country’s gross international reserves. Year-over-year, FCDU deposit liabilities decreased $102 million, or 0.2 percent, from $45.9 billion at the end of September 2021.