Bank lending expands 12.9% in March; household loans ease
Big banks’ outstanding loans went up by 12.9 percent in March, more than the 12 percent lending growth registered in February, based on Bangko Sentral ng Pilipinas (BSP) data.
While productivity loans increased during the period, lending for household consumption slowed down with the implementation of the enhanced community quarantine (ECQ) on March 17.
Lending for household consumption grew by 22.9 percent in March compared to 37.7 percent in February because of the “slower expansion” in credit card and motor vehicle loans. Household loans amounted to ₱837.66 billion of which car loans accounted for ₱384.08 billion and credit card loans ₱357.68 billion.
“It must be noted that community quarantine and ECQ were declared March
15 and 16, respectively. Following this, the
BSP crafted measures to ensure increased credit and domestic liquidity,” said the BSP.
The BSP added that it will “remain vigilant in monitoring liquidity and credit dynamics amid significant disruptions to economic activity” and that it “reassures the public of its commitment to deploy its full range of instruments to ensure that domestic liquidity and credit remain adequate amid the ongoing coronavirus pandemic.”
Bank lending net of reverse repurchase (RRP) or repos totaled ₱9.35 trillion for both residents and non-residents in March. Gross of RRP, the amount was ₱9.67 trillion. “On a month-on-month seasonally-adjusted basis, commercial bank loans net of RRPs grew by 1.5 percent,” said the BSP.
Lending for production activities minus RRPs grew by 12 percent in March, higher than February’s 9.4 percent. This totaled P8.18 trillion in March.
The BSP said the “sustained increase” of loans for productivity was led by the real estate sector, and financial and insurance activities which increased by 21.8 percent and 17.2 percent respectively, to ₱1.71 trillion and ₱932.46 billion.
Lending to the wholesale and retail trade, repair of motor vehicles and motorcycles, in the meantime went up by 6.8 percent to ₱1.19 trillion.
The BSP said lending to electricity, gas, steam and air conditioning supply sector and information and communication rose by 7.7 percent and 20.8 percent respectively, to ₱1 trillion and ₱374.14 billion.