Bank lending and domestic liquidity both accelerated in March 2026, signaling stronger economic activity as businesses borrowed more for expansion and households continued spending.
Loans issued by universal and commercial banks grew 10.7 percent year-on-year in March, faster than the revised 9.6 percent growth in February, according to preliminary data from the Bangko Sentral ng Pilipinas (BSP). On a month-on-month basis, bank lending also rose 1.7 percent after seasonal adjustments.
Business lending increased to 9.7 percent from 8.6 percent, with stronger borrowing seen in real estate, power and utilities, trade, and transportation sectors. Consumer loans also remained robust at 20.5 percent, although slightly slower than February’s 20.8 percent due to weaker growth in vehicle and salary-based loans.
At the same time, domestic liquidity or money supply (M3) expanded by 12 percent to ₱20.4 trillion in March, up from 10.3 percent in February. M3 measures the amount of money circulating in the economy, including cash and bank deposits.
The BSP said the increase in liquidity was mainly driven by continued borrowing by businesses and households, showing the close link between money supply growth and stronger bank lending activity.
For businesses, higher lending growth means improved access to financing for expansion, operations, and investment. For households, sustained consumer lending supports spending on vehicles, homes, and other purchases, helping drive overall economic demand.
The BSP said it will continue monitoring liquidity and lending conditions to ensure they remain consistent with its goals of keeping inflation manageable and maintaining financial stability.
