Housing loans are considered to be relatively less risky due to their collateralised nature (Fitch Ratings (2006)). Moreover, the Philippine government extends housing loans to households under its National Shelter Program, which is aimed at addressing the country’s chronic housing shortage. While the BSP imposes a 20% overall limit on banks’ real estate lending, to prevent universal/commercial banks from concentrating too heavily on commercial lending, it excludes from this prudential safeguard housing loans to individual households as well as loans extended to real estate developers for the construction of socialised and low-cost residential properties under various government housing programs. These.
