Higher peso rediscounting rates take effect today

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MANILA — Higher rates for loans under the Peso Rediscount Facility of the Bangko Sentral ng Pilipinas (BSP) took effect Tuesday, following the Monetary Board’s decision to raise key policy rates.

According to the central bank, the rate for loans with maturity of 1 to 90 days was set at 3.8125 percent from last week’s rate of 3.5625 percent.

For loans with maturity of 91 to 180 days, the rate was set at 3.8750 percent from 3.6250 percent.

Rates for the central bank’s peso rediscount facility were based on its overnight lending rate, plus term premia based on Circular No. 964 dated June 27, 2017.

Just last week, the Monetary Board hiked the policy interest rates by 25 basis points, the first time for the BSP to increase rates since September 2014.

Availment of the BSP’s peso rediscount facility from January to April 2018 reached PHP7.65 billion, 58 percent of which went to other credits, such as capital expenditures, permanent working capital, services, and housing.

About 42 percent were extended by banks as commercial credits, while less than 1 percent was extended as production credits.

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