Lending activity among banks remained robust in October, with universal and commercial banks (U/KBs) reporting a 10.6 percent year-on-year expansion in outstanding loans, slightly easing from the 11 growth in September, the Bangko Sentral ng Pilipinas (BSP) reported on Friday. On a month-on-month seasonally adjusted basis, bank loans grew by 0.9 percent.
The growth in loans to residents, excluding reverse repurchase (RRP) placements with the BSP, averaged 10.7 percent in October, down from 11.3 percent in the previous month. Conversely, loans to non-residents surged by 6.8 percent after a contraction of 0.3 percent in September.
Production loans, which account for the bulk of lending, rose by 9.1 percent, led by key sectors such as real estate activities (11.3 percent), wholesale and retail trade (7.2 percent), and manufacturing (8.8 percent). Consumer loans, particularly credit card and motor vehicle financing, continued to show strength, growing 23.6 percent year-on-year.
In tandem with lending growth, domestic liquidity (M3) increased by 5.5 percent year-on-year to ₱17.7 trillion, maintaining the same pace as the previous month. The BSP’s focus on liquidity management remains central to maintaining price and financial stability, with M3 rising 0.5 percent month-on-month on a seasonally adjusted basis.
Domestic claims grew by 9.8 percent in October, with claims on the private sector expanding 11.5 percent, fueled by continued strong lending to households and non-financial corporations. At the same time, net claims on the government rose by 8 percent, reflecting higher borrowings by the national government.
Looking ahead, the BSP emphasized its commitment to ensuring that liquidity and lending conditions remain aligned with its primary objectives of price stability and financial resilience.
