Preliminary data from the Bangko Sentral ng Pilipinas (BSP) highlighted continued growth in lending and domestic liquidity in September, reflecting robust economic activity and financial stability.
The outstanding loans of universal and commercial banks (U/KBs), net of reverse repurchase (RRP) placements with the BSP, rose by 11 percent year-on-year in September, slightly surpassing the 10.7-percent growth recorded in August. On a month-on-month seasonally-adjusted basis, loans increased by 0.8 percent.
The growth in loans was largely driven by lending to the productive sectors. Loans for production activities grew by 9.8 percent in September, up from 9.4 percent in August, with key sectors such as real estate (14.2 percent), wholesale and retail trade (12.0 percent), manufacturing (10.6 percent), and utilities (7.5 percent) seeing significant expansion.
Meanwhile, consumer loans grew by 23.4 percent, primarily driven by credit card lending, slightly easing from 23.7 percent in August.
While lending to residents showed strong growth, loans to non-residents decreased by 0.3 percent in September, reversing the 1.5-percent increase seen in August. Despite this, overall credit activity pointed to healthy domestic demand and growing liquidity.
Domestic liquidity (M3) expanded by 5.4 percent year-on-year in September, slightly slowing from 5.5 percent in August, reaching about ₱17.6 trillion. On a month-on-month seasonally-adjusted basis, M3 grew by 0.7 percent. Domestic claims, a key indicator of credit activity, grew by 9.6 percent, driven largely by a 12.4 percent increase in claims on the private sector, reflecting continued bank lending to households and private corporations.
The BSP’s net foreign assets (NFA) saw a notable increase of 8.6 percent in September, up from 2.4 percent in August, driven by higher gross international reserves. However, the NFA of commercial banks contracted slightly, due to higher bills payable.
Looking forward, the BSP remains committed to maintaining stable domestic liquidity and lending conditions, ensuring alignment with its price and financial stability objectives. This careful management of liquidity and credit expansion will support sustainable economic growth in the Philippines.
