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BANK
lending, which grew by 7.5 percent year-on-year in
August, was seen to approach double-digit levels by
year-end, according to Bangko Sentral ng Pilipinas
Governor Amando M. Tetangco Jr.
On
Monday Tetangco told reporters anemic bank lending
should not stay anemic for long as the low-interest-rate
environment should help spur greater lending activities
among banks and financial institutions.
“We see
bank lending growth in the low double-digit teens
level,” he said at the sidelines of the 9th
Intercollegiate Finance Competition organized by the
Financial Executives Institute of the Philippines (Finex)
and hosted by the BSP.
Bank
lending has never been the same since 1997 when a
regionwide financial crisis made a lot of lenders
loan-shy as borrowers, the most creditworthy included,
defaulted on their obligations.
Tetangco
does not worry too much on the relative lack of lending
activities among banks, saying the increasing
sophistication of the market has allowed borrowers to
obtain credit from less orthodox sources such as
privately issued bonds and notes, commercial papers and
others.
When
businesses and people wanted funds for expansion or for
capital in the past, banks were always the traditional
source.
Bank
lending lifted again to 7.5 percent in August from 6.9
percent in July, a turnaround from the 0.4-percent
decline a year earlier.
Bank
lending, with or without the banks’ placements with the
BSP that count as lending, both exhibited up trends,
averaging 4.3 percent year-on-year in August from 3.4
percent in July.
“On
month-on-month basis, seasonally adjusted lending in
August also grew by 0.4 percent from the 0.2-percent
expansion in July,” Tetangco said.
Bank
loans granted to the transportation, storage and
communications sector grew by 15.5 percent, construction
by 11.9 percent and the community, social and personal
services sector by 11.5 percent.
Lending
to the wholesale and retail trade grew by 4.1 percent;
to financial institutions, real-estate and business
service, by 6.4 percent. Lending to the agriculture,
fishery and forestry sector, however, slowed to 5.7
percent. |
