The Bangko Sentral ng Pilipinas (BSP) said loans supplied by banks’ foreign currency deposit units (FCDUs) decreased to $16.3 billion as of the end of March this year.

The current amount was $315 million lower, or 1.9 percent, than the end-December 2020 level of $16.7 billion, the central bank said in a statement on Wednesday, because “principal repayments exceeded disbursements.”

At the end of March 2020, outstanding FCDU loans had declined by $1.9 billion, or 10.6 percent, year over year to $18.3 billion.

“The decline in FCDU loans may be attributed to: the continued contraction of the economy during the quarter, which translated to lower working capital requirements among borrowers; the lender banks’ continued lower appetite to lend; and availability of other sources of funding,” according to the BSP.

The maturity profile of the FCDU loan portfolio remained largely medium- to long-term debt, or loans having a tenure of more than one year, at the end of March. This accounted for 79.1 percent of total revenue, up from 79.5 percent the previous year.

Of the 67.7 percent outstanding loans to residents, 60.2 percent went to power generation companies (27.1 percent), merchandise and service exporters (21.7 percent), and public utility firms (11.4 percent).

The Bangko Sentral also announced that gross disbursements at the end of March totaled $15.8 billion, up 13.5 percent from the end of December, “due to an increase in funding requirements of an affiliate of a foreign bank branch.”

Similarly, loan repayments grew by 10.6 percent, resulting in net repayments overall.

FCDU deposit liabilities were $44.5 billion at the end of March, down $553 million or 1.2 percent from $45.1 billion as of end-December.

“The quarter-on-quarter decline in FCDU deposits may be attributed to the sustained strength of the peso,” the central bank said.

The majority of these deposits (97.2 percent) continue to be owned by residents, contributing to the country’s gross international reserves, according to the central bank.

From $43.1 billion at the end of March 2020, FCDU deposit liabilities inched up by $1.4 billion, or 3.2 percent, year over year.