Bank loans and money supply continued to grow in December 2023, despite higher interest rates, according to preliminary data from the Bangko Sentral ng Pilipinas (BSP).
Outstanding loans of universal and commercial banks (U/KBs), net of reverse repurchase (RRP) placements with the BSP, grew 7 percent year-on-year in December, unchanged from November’s increase.
The BSP said that on a month-on-month seasonally-adjusted basis, loans rose 0.3 percent.
Loans to residents, net of RRPs, climbed 7.3 percent in December, compared to 7.4 percent the previous month. Lending to non-residents declined 2.8 percent after a 5-percent drop in November.
Production activity loans rose 5.5 percent in December from 5.7 percent in November, driven by real estate (10.9 percent), wholesale and retail trade (7.2 percent) and electricity, gas and airconditioning supply (6.2 percent).
Consumer loans to residents grew 23.5 percent in December, nearly matching the 23.6 percent increase in November on higher credit card, motor vehicle and salary-based general purpose loans.
Meanwhile, domestic liquidity (M3) or money supply grew 5.9 percent year-on-year to P7.4 trillion in December, compared to 7 percent in November. On a month-on-month seasonally-adjusted basis, M3 increased 0.4 percent.
Domestic claims expanded 9.0 percent year-on-year in December, down from 9.7 percent in November. Claims on the private sector grew 8.5 percent from 8.3 percent, while net claims on the central government increased 14.2 percent from 17.3 percent.
Net foreign assets (NFA) in peso terms rose 4.3 percent year-on-year in December, compared to 3.2 percent in November.
The BSP’s NFA grew 7.4 percent, while banks’ NFA contracted on lower interbank loans receivable.