April sees 9.6 percent growth in bank lending

Manila – Credit growth in the Philippines accelerated to 9.6 percent in April, up from 9.4 percent in March, as banks in the country disbursed more production and consumer loans, according to the Bangko Sentral ng Pilipinas (BSP).

Preliminary data from the central bank revealed that loans released by major banks reached P11.91 trillion as of end-April, compared to P10.87 trillion in the same period in 2023. April’s bank lending saw the fastest growth in 12 months, since the 9.7 percent expansion in April 2023.

The BSP data indicated that the increase in loan disbursements for production activities grew by 7.8 percent in April, accounting for 85.7 percent of total disbursements at P10.21 trillion.

Loans to the real estate sector surged by 11 percent to P2.44 trillion, followed by the electricity, gas, steam, and air-conditioning supply sector, which increased by 9.2 percent to P1.3 trillion. Furthermore, loans extended to the wholesale and retail trade, repair of motor vehicles and motorcycles sector, grew by 7.6 percent to P1.35 trillion. Loans to the transportation and storage sector also rose by 21.8 percent to P437 billion.

Consumer loans spiked by 25.3 percent to P1.35 trillion in April, accounting for 11.3 percent of total releases. However, the growth rate was slower compared to the 25.4 percent increase in March, mainly due to the slower rise in credit card loans.

Credit card receivables increased by 29.3 percent to P762.19 billion in April, while auto loans surged by 20.6 percent to P406.62 billion. Salary-based general-purpose consumption loans also rose by 18.3 percent to P46.73 billion.

The BSP stated that it will ensure that domestic liquidity and credit conditions are aligned with its price and financial stability objectives. Additionally, the central bank reported a 5.6 percent increase in money supply (M3) to P17.2 trillion in April from P16.3 trillion in the same month in 2023, where the growth rate was slightly lower than the 5.7 percent in March.

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