Bank lending grows by 7.7 percent  in July 2023

Preliminary data indicated that outstanding loans of universal and commercial banks (U/KBs), net of reverse repurchase (RRP) placements with the Bangko Sentral ng Pilipinas (BSP), expanded by 7.7 percent year-on-year in July from 7.8 percent in June.

On a month-on-month seasonally-adjusted basis, outstanding universal and commercial bank loans, net of RRPs, rose by 0.6 percent, similar with the previous month.

Outstanding loans to residents, net of RRPs, went up by 7.7 percent in July from 7.9 percent in June.

Outstanding loans for production activities increased by 6.2 in July after rising by 6.3 percent in the previous month, due to the continued increase in loans to major sectors, particularly electricity, gas, steam, and airconditioning supply (10.6 percent); wholesale and retail trade, and repair of motor vehicles and motorcycles (9.4 percent); real estate activities (5.0 percent); information and communication (10.8 percent); and transportation and storage (14.9 percent).

Similarly, consumer loans to residents grew by 22.6 percent in July from 23.7 percent in June, driven mainly by the increase in credit card and motor vehicle loans.

Outstanding loans to non-residents[1] rose by 6.2 percent in July from 4.8 percent in the previous month.

The growth in bank lending has continued to ease in line with the prevailing tight monetary policy stance of the BSP.

Looking ahead, the BSP will continue to ensure that domestic liquidity and credit dynamics remain consistent with its price and financial stability objectives.

[1] Outstanding loans to non-residents include loans by UKB’s foreign currency deposit units (FCDUs) to non-residents.