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Bank Lending Growth Slows Down in November


Preliminary data on outstanding loans of commercial banks, net of reverse repurchase (RRP) placements with the BSP, expanded at a slower rate of 19.2 percent in November from 19.9 percent in October. Meanwhile, bank lending inclusive of RRPs grew by 18.3 percent in November from 18.0 percent in the previous month. On a month-on-month seasonally-adjusted basis, commercial bank lending for loans net of RRPs and loans inclusive of RRPs increased by 1.2 percent and 1.9 percent, respectively.

Loans for production activities—which comprised 88.4 percent of banks’ aggregate loan portfolio, net of RRP — grew albeit at a slower rate of 18.5 percent in November from 18.7 percent in October. The growth in production loans was driven primarily by increased lending to the following sectors: real estate activities (18.3 percent); electricity, gas, steam and airconditioning supply (24.2 percent); wholesale and retail trade, repair of motor vehicles and motorcycles (18.5 percent); financial and insurance activities (23.1 percent); manufacturing (11.5 percent); and, information and communication (31.4 percent). Bank lending to other sectors also increased during the month except in public administration, defense and compulsory social security (-2.1 percent), and administrative and support services activities      (-31.5 percent).

Growth in loans for household consumption decelerated to 20.6 percent in November from 23.4 percent in October. The acceleration in the growth in credit card loans was offset by the slower increase in motor vehicle loans and salary-based general purpose loans as well as the decline in other types of household loans.

The BSP will continue to ensure that the expansion in domestic credit and liquidity conditions proceeds in line with overall economic growth while remaining consistent with the BSP’s price and financial stability objectives.

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