MANILA, Philippines – Bank lending growth remained steady in August on the back of strong demand from corporate and retail borrowers, the Bangko Sentral ng Pilipinas (BSP) reported yesterday.
BSP Governor Amando Tetangco Jr. said outstanding loans of commercial banks grew 17.3 percent to P5.48 trillion in end-August from P4.67 trillion in end-August last year.
The latest growth rate was slightly lower than the 17.7 percent expansion recorded in July.
Tetangco said loans for production activities increased 17.3 percent to P4.88 trillion from P4.16 trillion and accounted for 89.2 percent of the bank’s total loan portfolio in end-June.
Data showed loans to real estate activities went up 19.5 percent to P967.92 billion and accounted for 17.7 percent of the total loan portfolio, while lending to the manufacturing sector increased 7.7 percent to P766.86 billion for a 14 percent share.
Loans to the wholesale and retail trade as well as repair of motor vehicles and motorcycles rose 15.9 percent to P757.57 billion for a 13.8 percent share, while lending to electricity, gas, steam and airconditioning supply surged 30.9 percent to P634.28 billion for an 11.6 percent share.
On the other hand, loans for household consumption went up 20.3 percent to P436.23 billion in end-August from P362.65 billion in end-August last year.
Statistics showed motor vehicle loans zoomed 34.9 percent to P184.73 billion from P136.94 billion, while credit card loans went up 8.7 percent to P180.61 billion from P166.17 billion.
Salary-based general consumption loans soared 63.1 percent to P58.34 billion from P35.77 billion.
“Going forward, the BSP will continue to ensure that domestic credit and liquidity conditions will keep pace with overall economic growth while remaining consistent with its price and financial stability objectives,” Tetangco said.
The economy grew seven percent in the second quarter from 6.8 percent in the first quarter due to the boost from election related spending and strong investments.
This brought the GDP growth to 6.9 percent in the first half from 5.5 percent in the same period last year.
The government has penciled a lower GDP growth of six to seven percent instead of between 6.8 and 7.8 percent this year as it intends to spend more for infrastructure.
President Duterte has raised its budget deficit ceiling to three percent of GDP instead of two percent of GDP under the administration of former president Benigno Aquino III.