Manila, Sept. 5 -- The proportion of non-performing loans (NPLs) of Philippine banks to their total loans slightly went up in July, data released by the Bangko Sentral ng Pilipinas (BSP) showed.

Data released Friday showed that the NPL ratio during the month settled at 3.40 percent from 3.34 percent in June.

It was lower than the 3.58 percent NPL ratio recorded in July last year.

The gross non-performing loans reached PHP535.4 billion.

Philippine Institute for Development Studies senior research fellow John Paolo Rivera said the uptick in NPL reflects delayed effects of tighter credit conditions earlier in the year, combined with a likely shift toward riskier lending as rates started easing.

"While falling interest rates generally su...