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THE
amount of money raised in the first nine months through
the sale of bonds has more than doubled to P83 billion,
the Bangko Sentral ng Pilipinas (BSP) reported on
Monday.
BSP
Governor Amando M. Tetangco Jr. said this clearly showed
that financing, almost exclusively raised via bank loans
in the past, has shifted to include nonbank fundraising
exercises.
This, he
added, also partly explains why bank lending has not
reacquired its pre-1997 luster when gross loans were
posting very high growth rates.
“From
January to present, bond- sale proceeds totaled P83
billion as compared with only P30 billion in the first
nine months last year,” Tetangco said.
According to the BSP chief, the 177-percent rise in the
sale of bonds as funding source “indicates the economy
is changing.”
“Many
funding initiatives now result in a deeper and [much]
expanded capital market,” he said.
The
domestic capital market is rated one of the most
undeveloped in the region as investors with long-horizon
financing needs have to scrape the bottom of the barrel
to find the financial instrument they require.
The
changing fundraising landscape, then, is a welcome
development, Tetangco stressed.
“Traditional banking products and services may now no
longer be as important as before,” Tetangco said.
In
mature financial markets, the range of financial
products available for long-term investors is very much
varied, to include not just the short-term instruments
that banks offer, but also equity issues openly traded
in stock markets as well as bonds for those requiring
long-term funding, he said.
The more
than doubling of bond sales this year pales beside the
6.2- percent growth year-on-year in bank lending is
September, itself a reduction from the 7.1-percent
annual clip it posted in August.
The
7.1-percent growth in bank lending the previous month
represented a six-year high, Tetangco previously said.
Thus
far, bank lending growth this year has been anything but
consistent, having trended down from P1.813 trillion at
the beginning of the year until June and July, when this
briefly rose, only to fall back again in subsequent
months.
Aggregate bank loans totaled P1.755 billion at the start
of the year, but moderated to P1.813 trillion as of
latest BSP data. |
