LOANS extended by universal and commercial banks (UKBs), net of reverse repurchase (RRP) placements with the Central Bank, continued to post double-digit growth in August.
In a preliminary report, the Bangko Sentral ng Pilipinas (BSP) said outstanding loans of UKBs grew 12.2 percent in August, faster than the 12 percent posted in July 2022.
On a month-on-month seasonally adjusted estimate, outstanding universal and commercial bank loans, net of RRPs, rose by 1.3 percent.
“The sustained expansion in credit activity and ample liquidity will continue to support the recovery of economic activity and domestic demand. Looking ahead, the BSP reiterates its commitment to ensure that liquidity and lending conditions remain in line with the BSP’s price and financial stability mandates,” BSP said.
Data showed outstanding loans to residents grew 12.1 percent in August from an increase of 11.9 percent in July.
Meanwhile, outstanding loans for production activities rose by 11.5 percent in August from a growth rate of 11.6 percent in July.
This was mainly driven by the rise in credit for real-estate activities (13.9 percent); manufacturing (15.9 percent); information and communication (28.6 percent); wholesale and retail trade, repair of motor vehicles and motorcycles (9.7 percent); and electricity, gas, steam and air-conditioning supply (9 percent).
The data also showed consumer loans to residents grew faster by 18.3 percent in August from 14.7 percent in July driven by the year-on-year rise in credit card loans, motor vehicle loans, and salary-based general purpose consumption loans.
“At the same time, outstanding loans to non-residents expanded by 16.3 percent in August following a 14.6-percent increase in the previous month,” the BSP added.
Liquidity grows 6.8%
Meanwhile, in a separate preliminary report, the BSP said domestic liquidity (M3) grew by 6.8 percent year-on-year to about P15.4 trillion in August from the 7-percent growth in July. On a month-on-month seasonally-adjusted basis, M3 increased by 0.9 percent.
“Looking ahead, the BSP will continue to ensure that domestic liquidity conditions remain in line with the BSP’s price and financial stability objectives,” BSP said.
Domestic claims rose by 11.5 percent year-on-year in August, unchanged from the rate recorded in the previous month, given the improvement in bank lending to the private sector.
Claims on the private sector grew by 9.1 percent in August from 8.9 percent in July with the sustained expansion in bank lending to non-financial private corporations and households.
Meanwhile, net claims on the central government rose by 21.2 percent in August from 22.2 percent in July owing to the sustained borrowing by the national government.
Net foreign assets (NFA) in peso terms decreased by 0.8 percent in August following a 0.5-percent contraction in July. The NFA of banks likewise contracted mainly on account of higher bills payable. Meanwhile, the BSP’s NFA position returned to expansion after contracting in the previous month.
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