Bank Lending Slows Down in June
Preliminary data show that outstanding loans of universal and commercial banks, net of reverse repurchase (RRP) placements with the BSP, grew at a slightly slower rate of 10.5 percent in June from 11.9 percent in May. Similarly, the growth in bank lending inclusive of RRPs decelerated to 10.5 percent in June from 10.6 percent in the previous month. On a month-on-month seasonally-adjusted basis, commercial bank loans net of RRPs grew by 0.2 percent while commercial bank loans inclusive of RRPs also increased by 0.3 percent.
Loans for production activities—which comprised 88.0 percent of banks’ aggregate loan portfolio, net of RRPs—increased at a slower pace of 9.8 percent in June from 11.5 percent in the previous month. The growth in production loans was driven primarily by lending to the following sectors: real estate activities (13.5 percent); financial and insurance activities (22.0 percent); electricity, gas, steam and air conditioning supply (13.5 percent), construction (42.5 percent); wholesale & retail trade, repair of motor vehicles and motorcycle (6.5 percent); and manufacturing (4.1 percent).
Bank lending to other sectors also increased during the month except those in other community, social and personal activities (-51.9 percent) and professional, scientific and technical activities (-30.5 percent).
Meanwhile, loans for household consumption grew by 15.3 percent in June from 14.6 percent in May, due to faster growth in credit card, motor vehicle, and salary-based general purpose consumption loans during the month.
Going forward, the BSP will continue to ensure that the expansion in domestic credit and liquidity remains consistent with the BSP’s price and financial stability objectives.