• Bank lending slightly lower in Oct.

    0

    Bank lending slightly slowed down in October as outstanding loans of commercial banks, net of reverse repurchase (RRP) placements with the Bangko Sentral ng Pilipinas (BSP) were recorded at 13.6 percent, lower compared to revised 16.2-percent growth in the previous month.

    The BSP said that the growth of bank lending inclusive of RRPs in the same month was also on a slightly slower pace of 13.5 percent from the revised 14.9 percent in September.

    On a month-on-month seasonally adjusted basis, commercial bank lending increased by 0.1 percent for loans net of RRPs, and by 0.6 percent for loans inclusive of RRPs.

    Meanwhile, loans for production activities grew by 12.3 percent in October from the revised 15.3 percent a month ago. The central bank said that loans for production activities comprised more than four-fifths of banks’ aggregate loan portfolio.

    “The expansion in production loans was driven primarily by increased lending to the real estate, renting and business services; electricity, gas and water; wholesale and retail trade; manufacturing; and construction,” the BSP stated.

    However, lending to public administration and defense; agriculture, hunting and forestry; and transportation, storage and communication recorded declines in October.

    The central bank said that consumer loans accelerated to 11.2 percent from 10.7 percent in the previous month, reflecting the growth in credit card and auto loans.

    “The continued broad-based growth in bank lending supports the sustained expansion of the productive sectors of the economy,” it added.

    The BSP said that it will ensure that credit and liquidity conditions keep pace with overall economic activity, while remaining consistent with price and financial stability objectives.

    In his speech during the Foreign Correspondents Association of the Philippines Media Forum, BSP Governor Amando Tetangco Jr. said that based on BSP assessment, the banks have made very deliberate choices to continue to lend bulk of their funds to the relatively capital-intensive productive sectors of the economy.

    “We are confident that given the current regulatory environment and the banks’ observed risk appetite, banks will continue to be discriminating in the projects they will fund. Indeed, there is room to grow further in this respect, given our ratio of credit to gross domestic product remains below that of our peers in the region,” he said.

    Share.
    loading...
    Loading...

    Please follow our commenting guidelines.

    Comments are closed.