Bank loans and money supply posted year-on-year growth in the third quarter, amid sustained demand for credit by the private sector, Bangko Sentral ng Pilipinas said Monday.
Data showed that domestic liquidity, or the money supply circulating in the financial system, rose 8.7 percent in September to P7.8 trillion. The growth figure, however, was slower than the 9.3-percent increase in the second quarter.
“The increase in M3 [domestic liquidity] was driven largely by the 12.7-percent year-on-year growth in domestic claims or credits to the domestic economy in September 2015,” Bangko Sentral said.
“Credits extended to the private sector grew by 12.9 percent, consistent with the sustained growth in bank lending. Meanwhile, net claims on the central government rose by 16.5 percent,” it said.
Net foreign assets in peso terms rose 6.8 percent year-on-year in September. Bangko Sentral’s net foreign asset position continued to expand during the month on the back of robust foreign exchange inflows coming mainly from overseas Filipinos and business process outsourcing receipts.
Meanwhile, outstanding loans of commercial banks, net of placements with Bangko Sentral, rose 12.6 percent year-on-year in the third quarter.
Data showed that including placements with Bangko Sentral, total loans also increased 12.4 percent.
The continued broad-based growth in bank lending supported the sustained expansion of the productive sectors of the economy in the third quarter, Bangko Sentral said.
Loans for production activities, which comprised more than 80 percent of banks’ aggregate loan portfolio, expanded 13.2 percent.
The growth in production loans was driven by increased lending to real estate activities (up by 20.4 percent); electricity, gas, steam and air-conditioning supply (27.5 percent); wholesale and retail trade, and repair of motor vehicles and motorcycles (14.4 percent); and financial and insurance activities (16 percent).
Bank lending to other sectors also expanded during the month except for transportation and storage, other community, social and personal activities, and manufacturing, which declined by 0.1 percent, 0.3 percent, and 2.2 percent, respectively.
Loans for household consumption increased 12.7 percent in September, led by sustained growth in credit card, salary and auto loans.