Citing sluggish economy, state bank reins in loan disbursals
The state-run Philippine Export-Import (Philexim) Bank this year may not be able to fully disburse the P23 billion in loans to clients due to the sluggish economy, particularly during the third quarter.
Francisco S. Magsajo Jr., Philexim president and chief executive, said the slowdown of overseas orders for locally manufactured products led to a decline in demand for the bank’s services.
“We have released to our clients some P18 billion in outstanding loans as of the end of October,” Magsajo said in an interview. “But we may not reach the target [of P23 billion] for 2011.”
Earlier, Magsajo was quoted as saying that Philexim could grow its business by as much as 79 percent to P25 billion this year, from P14 billion in 2010, through the infrastructure and development projects guaranteed under the Aquino administration’s public-private partnership (PPP) program.
But after months of hype, projects under the PPP scheme have not taken off, and Philexim may have to rein in its expectations, even on its goal of growing its business by 64 percent.
“Even investors that would have poured in additional or new capital have shown signs of slowing down,” Magsajo said. “But the pace [of our business] is still okay.”
In 2012, Philexim plans to build up its portfolio by “five times as much as the government’s gross domestic product growth target of
between 5.5 percent and 6.5 percent,” the CEO said.
He said Philexim would also increase its loan exposure by 30 percent in 2012 from that of 2011.
“Debt problems in the eurozone may linger next year, but we are looking at the Asian market and other nontraditional markets,” Magsajo said.
Under Republic Act No. 8494, which reorganized and renamed the former Philippine Export and Foreign Loan Guarantee Corp., Philexim is mandated to promote and facilitate the entry of foreign loans into the country for development purposes.
Philexim is focused on the needs of export-oriented industries, industries registered with the Board of Investments and public utilities.
Philexim guarantees loans that Philippine banking and financial institutions extend to qualified exporters, producers of export products, and contractors with approved service contracts abroad.
Magsajo said a huge chunk of Philexim’s exposure is in the production of basic metals that would be shipped to China and Japan, as well as power generation, particularly those involving renewable energy resources.
