Lending for production eases; consumer loans up
Bank lending grew at a still robust though slower clip in November, tempered by a slowdown in production activity and in line with the central bank’s policy of mopping up excess liquidity. But loans for household consumption such as credit card spending and auto and personal loans gained pace on the back of seasonal demand.
Outstanding loans granted by commercial banks, excluding reverse repurchase (RRP) placements with the central bank, rose 20 percent in the month, easing from the 21.1 percent rise recorded in October, Bangko Sentral ng Pilipinas (BSP) data showed.
Including the RRPs, bank lending expanded by 18.9 percent, losing some steam from the 20 percent rise posted in the month earlier. On a seasonally adjusted basis, commercial bank lending increased 0.9 percent for loans net of RRPs month-on-month and by 0.5 percent for loans inclusive of RRPs.
Lending for production activities, which comprised more than four-fifths of banks’ aggregate loan portfolio, slowed to 18.6 percent in November from 19.7 percent in October.
Increases, though generally milder, were seen in real estate, renting, and business services; wholesale and retail trade; manufacturing; financial intermediation; electricity, gas and water; and transportation, storage and communication.
Money lent for household consumption, on the other hand, grew at a brisker pace of 20.7 percent, compared with the previous 17.3 percent.
The central bank attributed the increase in household lending to continued expansion seen across all types of consumer loans such as credit cards, auto loans and other types of personal loans.
“Bank lending to other sectors also rose during the month, except for public administration and defense, which declined by 0.9 percent,” the BSP said.
“Going forward, the BSP will ensure that credit and liquidity conditions keep pace with overall economic growth while remaining consistent with the BSP’s price and financial stability objectives,” the BSP added.