Commercial lending growth slows in May
abs-cbnNEWS.com | 07/03/2009 5:50 PM
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MANILA - Growth in lending of Philippine commercial banks slowed further in May as households and businesses continue to rein in spending amidst the economic slump.
The Bangko Sentral ng Pilipinas (BSP) reported Friday that outstanding loans granted by commercial banks amounted to P2.1 trillion in May, a 10.2 percent growth year-on-year. However, this was a slowdown from the 13.4 percent annual expansion recorded in April.
Stipping out reverse repuchase agreements or inter-bank loans, commercial bank lending rose 17.3 percent in May to P2 trillion after a 19-percent increase in the month before.
BSP Governor Amando Tetangco Jr. noted that banks have tightened their credit standards and more firms have turned to the bond market for funding, resulting in the slowdown in bank lending. Despite this, he said "lending growth remained healthy."
Loans extended to the productive sectors--including agriculture, hunting and forestry--grew 42 percent, accounting for nearly half of total loans in May.
Lending to real estate, renting and business services; financial intermediation, transportation, storage and communication; and electricity, gas and water also recorded double-digit growth rates.
Meanwhile, growth in consumption loans moderated to 9.6 percent in May from 13.5 percent in the previous month, following the slower growth in auto loans and credit card lending, and the contraction in other types of loans.
Tetangco said the BSP would continue to ensure that liquidity conditions are supportive of the spending and investment needs of firms and households, while keeping a watchful eye on price stability.
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