The Bangko Sentral ng Pilipinas (BSP) on Friday reported that the outstanding loans of universal and commercial banks (U/KBs) increased by 12.8 percent year-on-year in January, up from 12.2 percent in December 2024. On a seasonally adjusted month-on-month basis, these loans grew by 1.4 percent. The growth in loans signals robust credit activity, contributing to economic stability amid ongoing financial conditions.
Loans extended to residents saw a 13.3 percent annual increase in January, a slight rise from the previous month’s 12.4 percent. In contrast, loans to non-residents fell by 3.5 percent, reversing the 5.7 percent gain recorded in December 2024. Notably, loans for production activities experienced an 11.8 percent increase, fueled by significant growth in key industries like real estate (9.8 percent), electricity and gas (23.6 percent), wholesale and retail trade (13.9 percent), transportation (21.4 percent), and manufacturing (4.6 percent).
Consumer loans to residents grew by 24.4 percent in January, driven primarily by a rise in credit card and motor vehicle loans, although the growth rate slightly slowed from December’s 25.0 percent. These developments indicate a sustained demand for both business and consumer financing, reflecting confidence in the economy.
Domestic liquidity (M3) also continued to rise, expanding by 6.8 percent year-on-year in January, bringing the total to ₱18.1 trillion. This is an increase from 7.7 percent growth recorded in December 2024. However, on a seasonally adjusted month-on-month basis, M3 saw a slight decline of 0.5 percent. Domestic claims expanded by 10.9 percent, with claims on the private sector rising by 13.1 percent due to strong bank lending to businesses and households.
The BSP also reported a growth in net foreign assets (NFA) in peso terms by 2.6 percent, down from the 6.0 percent recorded in December, primarily driven by higher foreign currency-denominated liabilities of banks.
Looking ahead, the BSP emphasized its commitment to ensuring that liquidity and lending conditions remain aligned with its price and financial stability mandates. With the continuation of this growth trend, the BSP aims to support a stable and conducive environment for both economic expansion and inflation management.
