Bank lending growth, net of banks’ reverse repurchase (RRP) placements with the BSP, accelerated slightly in November to 9.0 percent year-on-year from an expansion of 8.4 percent in the previous month. Inclusive of RRPs, outstanding loans of commercial banks likewise registered a stronger growth of 10.3 percent in November from 9.1 percent in October to reach P2.5 trillion. On a month-on-month seasonally-adjusted basis, commercial banks’ lending in November rose by 2.0 percent for loans net of RRPs and 1.4 percent for loans inclusive of RRPs.
The growth of loans for production activities—which comprise about four-fifths of commercial banks’ total loan portfolio—accelerated to 9.9 percent in November from 9.4 percent a month earlier. Likewise, consumer loans (which include credit card receivables and auto loans) expanded at a brisker pace of 12.0 percent from 8.9 percent previously.
The growth of production loans was driven mainly by increased lending to manufacturing (which grew by 16.0 percent); agriculture, hunting and forestry (13.4 percent); real estate, renting and business services (11.9 percent); and electricity, gas and water (17.8 percent). Lending to construction activities also grew at a slightly faster rate of 13.5 percent from 13.2 percent in the previous month. Meanwhile, contractions were posted in lending to fishing (-9.0 percent); education (-4.0 percent); public administration and defense (-6.1 percent); and other community, social and personal services (-18.9 percent).
The sustained growth in bank lending suggests that the momentum of domestic economic activity remains strong. Going forward, the BSP will continue to ensure that domestic credit conditions remain supportive of the expanding economy while maintaining a favorable inflation environment.