Banks’ forex loans surged in Sept.

Bank loans denominated in foreign currencies grew by a double-digit pace as of end-September, as growing liquidity of the creditors increased their appetite for lending.

The Bangko Sentral ng Pilipinas on Friday reported that outstanding loans from foreign currency deposit units (FCDUs) of banks amounted to $6.6 billion as of the end of the third quarter, rising by 25.6 percent from the $5.2 billion reported in the same period the previous year.

The BSP said the largest beneficiaries of the increase in foreign currency-denominated credit were manufacturing firms, particularly exporters.

Filipino exporters normally import raw materials, using dollars to purchase the items.

The growth in loans matches the 20 percent growth in peso-denominated loans that the central bank reported earlier.

According to the BSP, banks are now substantially liquid, enabling them to extend more credit.

Data from the BSP also showed that FCDUs had $24.6 billion worth of deposit liabilities.

With this amount, the loans-to-deposit ratio of FCDUs stood at 26.7 percent as of end-September.

Analysts said the ratio was comfortable and reflected the capacity of banks to lend more.

Despite the increase in bank loans, exporters still suffered from declines in revenue this year due to the debt crisis in Europe and the economic woes of the United States—two of the biggest export markets for Philippine-made goods.

Most economists believe that the crisis in the euro zone will persist, if not worsen, in 2012.

Filipino exporters are then urged to turn to other export markets and sell more goods to better-performing economies, such as those in Asia.