Bank loans in December Extensive at the fastest pace in two years, proved provisional data from the Bangko Sentral NG Pilipinas (BSP).
Excellent loans from universal and commercial banks jumped year after year by 12.2% to P13.1 trillion of P11.7 trillion in the same period in 2023.
This was the fastest growth in two years or since the 13.7% registered in December 2022.
On a seasonal basis, the outstanding loans from large banks rose by 1.4% month after month.
Data in the central bank showed outstanding loans to residents with 12.4% to P12.8 trillion in December, faster than the growth of 11.4% in November.
Meanwhile, loans to non -residents in the month by 5.7% to P330 billion, faster than the 3.9% posted in November.
Excellent loans to residents for production activities expanded in December by 10.8% to P11.2 trillion, faster than 9.8% in the previous month. Production loans were good for the bulk (85.4%) of the total lending.
The BSP said that the growth was powered by persistent lending in wholesalers and retail, repair of motor vehicles and motorcycles (10.1%); electricity, gas, steam and air conditioning facility (14.2%); production (7.4%); financial and insurance activities (7.4%); and construction (12.6%).
In the meantime, consumer loans in December rose by 25% of 23.3% in the previous month. Data for consumer loans excluded residential real estate loans.
This was due to the ‘increase in credit card loans; Salary-based consumption lenses for general purposes and loans for motor vehicles, “said the Central Bank.
BSP -data showed that credit card loans in December with 29.4% rose from 26.5% a month earlier. Salary-based consumption lenses for general purposes were also picked up by 16.5% of 15% in the previous month in December.
However, the growth of loans for motor vehicles reduced slightly in December to 19.5% of 19.6% in the previous month.
Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said that the growth of the loan arose when the BSP started its relaxation cycle.
The central bank started his rate -saving cycle in August last year. It reduced the loan costs with a total of 75 basic points (BPS), which brought the most important rate at the end-2024 to 5.75%.
For the coming months, the relaxation of inflation can justify further reductions this year and “stimulate a greater demand for loans as a result of lower financing costs,” said Mr. Ricafort.
A Business world Poll that was performed last week showed that 19 out of 20 analysts expect the monetary board to reduce the Reverse return percentage on Thursday by 25 BPS.
BSP -Governor Eli M. Remolona, Jr. has said that a rate reduction is still ‘on the table’.
Before 2025 he indicated the opportunity to cut a total of 50 BPS, and noted that 75 BPS or 100 BPS can be a bit “too much”.
Mr. Ricafort also noted that the reduction in the reserve requirement Ratio (RRR) “could have fundamentally increased the loan funds of banks.”
The BSP reduced the RRR for universal and commercial banks and non-banking institutions with quasi-banking functions with 250 BP to 7% of 9.5%, which came into effect in October.
Mr Remolona said that the monetary board to the reserve requirements is to reduce reserve requirements to 5%this year, somewhere in the middle of the year.
“The pick -up in the growth of the bank loan in recent months could be attributed to improved business and economic circumstances, in particular in terms of improved information about employment in recent months,” Mr Ricafort added.
Money -quantity
In the meantime, domestic liquidity (M3) grew by 7.7% in December, the same as November.
M3 – which is considered the widest benchmark for liquidity in an economy – increased to P18.8 trillion from December of P17.4 trillion a year earlier.
Monthly to month, M3 fell on inch by 0.2% on a seasonal basis.
Data from the BSP showed that domestic claims rose by 10.4% during the month, although slower than the 10.8% in November.
“Claims on the private sector grew by 12.2% in December of 11.7% in the last month with the continuous expansion of bank loans to non -finance private companies and households,” said the BSP.
The growth of the net claims on the central government was demolished in December to 7.2% of 9.2% in the previous month as a result of higher national government loans.
In the meantime, the growth of the net foreign assets (NFA) in PESO terms also fell to 6% of 9.8% in November.
“The NFA of the BSP has expanded with 6.8%, which reflects the increase in gross international reserves compared to a year ago. In the meantime, the NFA from banks fell due to higher accounts and bonds to be paid, “it added. – – Luisa Maria Jacinta C. Jocson