THE CENTRAL BANK received more loan review requests from local government units, which were mostly for infrastructure projects. — BW FILE PHOTO
THE BANGKO SENTRAL ng Pilipinas (BSP) assessed more loan review requests from local government units (LGU) worth P47.2 billion in the first half of 2021, with financing mostly meant for infrastructure development.
There were 198 opinion requests from the Monetary Board in the first half of the year, higher by 23.8% than the 160 borrowings that were brought for review in the second half of 2020, the BSP said in a statement.
By value, loans that needed to be reviewed in the January to June period increased by 10.3% from the P42.8 billion in the second semester last year.
The Monetary Board has issued 184 opinions on proposed LGU loans amounting to P44.8 billion. These include 157 requests for the first half of 2021 and 41 review proposals received in 2020.
The BSP said the opinions for the remaining 41 LGU requests submitted in the first semester will be processed after the concerned units complete the requirements.
The review requests came from 21 provinces (P13 billion), 18 cities (P15 billion), 157 municipalities (P19.1 billion), and two barangays (P25.5 million).
Metro Manila had the biggest amount of loans which were given opinions by the Monetary Board, as the BSP granted reviews for three LGUs with loans worth P6.183 billion.
Of these three, Mandaluyong’s P4.4-billion borrowing program was the biggest. It will finance pandemic response and infrastructure projects.
Regions that followed based on amount of loans with credit opinion from the Monetary Board were Cagayan Valley (P4.14 billion), Central Visayas (P4.062 billion), and Calabarzon (P3.49 billion).
Under Republic Act No. 11211 or the New Central Bank Act, LGUs and the National Government need to secure an opinion from the Monetary Board for their proposed borrowings, underscoring the role of the BSP as an advisor on official credit operations of the state. — L.W.T. Noble