FCDU credit down 0.7%

Outstanding loans granted by banks’ foreign currency depository units (FCDU) amounted to $15.7 billion at the end of December 2021, registering a slight decrease of $115 million, or 0.7% , compared to the end of the prior quarter’s FCDU outstanding loans of $15.8. billion as principal repayments exceeded disbursements.

Outstanding FCDU loans recorded a further decline during the fourth quarter of 2021 after its downward trend of the last six (6) consecutive quarters since the start of the pandemic despite signs of economic recovery in recent quarters.

The decline in FCDU loans can be attributed to the tightening of credit standards of lending banks, which led to a slowdown in their lending operations and credit activity; and the availability of other sources of funding.

Year-over-year, outstanding FCDU loans decreased by $938 million from the end-December 2020 level of $16.7 billion.

At the end of December 2021, the maturity profile of the FCDU loan portfolio remained mainly medium and long-term debt which represented 80.0% of the total, the same level as at the end of December 2020.

Of the total outstanding 66.0% of loans to residents, 59.7% went to the following resident industries: power generation companies; exporters of goods and services; and public utility companies.

Gross disbursements in the fourth quarter of 2021 reached $15.7 billion and were 20.5% higher than the previous quarter figure, mainly due to an increase in the financing needs of a subsidiary of a branch of a foreign bank.

Similarly, loan repayments in the fourth quarter of 2021 totaled $15.8 billion, an increase of 17.9% over the previous quarter’s figure. These resulted in overall net reimbursements.

FCDU’s deposit liabilities stood at $46.1 billion at the end of December 2021, up $217 million from the $45.9 billion level at the end of September 2021.

The bulk of these deposits continue to be owned by residents, essentially providing an additional buffer for the country’s gross international reserves.

Year-over-year, FCDU’s deposit liabilities increased by $1.0 billion from the end-December 2020 level of $45.1 billion.

Comments are closed.