The pace of bank lending slowed to its lowest level in over two years in November 2018 after regulators imposed an aggressive string of interest rate increases in a bid to tame last year’s high inflation rate, data from the Bangko Sentral ng Pilipinas (BSP) showed.
In a statement, the central bank said outstanding loans of commercial banks, excluding short term bank placements with it, grew at a slower rate of 16.8 percent in November, from 18.1 percent in October.
Similarly, growth in bank lending inclusive of placements with the regulator decelerated to 15.4 percent in November from 17.9 percent in previous month.
On a month-on-month seasonally-adjusted basis, commercial bank loans net of short term central bank placements increased by 0.3 percent, while loans inclusive of these placements declined by 0.1 percent.
BUSINESS
BUSINESS
BUSINESS
Loans for production activities—which comprised 88.7 percent of banks’ aggregate loan portfolio, net of RRP—increased at a slower pace of 17.2 percent in November from 18.7 percent in the previous month.
Growth in production loans was driven primarily by increased lending to the following sectors: wholesale and retail trade, repair of motor vehicles and motorcycles (19.7 percent); financial and insurance activities (29.4 percent); real estate activities (12.5 percent); manufacturing (16 percent); electricity, gas, steam and airconditioning supply (11 percent); and construction (38.1 percent). Bank lending to other sectors also increased during the month.
