Daily Tribune
Foreign currency deposit unit (FCDU) loans extended by banks operating in the Philippines declined by 0.8 percent in the first quarter of 2026, reflecting slightly weaker demand for foreign currency financing.
Data released by the Bangko Sentral ng Pilipinas (BSP) showed outstanding FCDU loans stood at $15.44 billion as of end-March 2026, down by $122.25 million from $15.56 billion at the end of December 2025.
Philippine-based borrowers accounted for $10.44 billion, or 67.6 percent, of total outstanding FCDU loans, while the remaining 32.4 percent was extended to non-residents. Major domestic borrowers included merchandise and service exporters, which accounted for $2.75 billion in loans; companies in the towing, tanker, trucking, forwarding, personal, and other industries, with $2.51 billion; and power generation firms, with $1.85 billion.
Most FCDU loans remained medium- to long-term, with maturities of more than one year accounting for 77.1 percent of the total loan portfolio, slightly lower than the 79.2 percent recorded in the previous quarter.
The BSP said loan activity during the quarter reflected $8.25 billion in new borrowings and $8.36 billion in repayments, resulting in the overall decline in outstanding balances.
FCDU loans are foreign currency-denominated loans granted by local banks and branches of foreign banks authorized by the BSP to engage in foreign exchange transactions. These facilities are commonly used by exporters, importers, and other businesses with foreign currency funding requirements.
Separate BSP data showed FCDU deposit liabilities reached $60.77 billion as of end-March 2026, bringing the sector's loans-to-deposits ratio to 25.4 percent, lower than the 26.0 percent recorded in the previous quarter.
