Bank lending for household consumption grew by 26.7 percent in October

Loans from universal and commercial banks for household consumption grew by26.7 percent in October from 26.2 percent in September, due to faster growth in motorvehicle, credit card, and salary-based general purpose consumption loans during the month.

Meanwhile, loans for production activities—which comprised 87.2 percent of banks’aggregate loan portfolio, net of RRPs—expanded at a rate of 7.5 percent in October, lowerthan the reported growth in September at 9.0 percent.

The sustained increase in productionloans was driven primarily by lending to the following sectors: real estate activities(18.4 percent); financial and insurance activities (11.6 percent); construction (28.9 percent);electricity, gas, steam and air conditioning supply (5.2 percent); and wholesale and retail trade,repair of motor vehicles and motorcycle (3.0 percent).

Bank lending to other sectors also increased during the month, except those inprofessional, scientific and technical activities (-28.0 percent) and other community, social andpersonal activities (-34.4 percent).

Notwithstanding the expansion in credit across sectors, growth in outstanding loans ofuniversal and commercial banks, net o f reverse repurchase (RRP) placements with the BSP, wasslower at 9.3 percent in October, from 10.5 percent in the previous month. On a month-on-monthseasonally-adjusted basis, commercial bank loans net of RRPs grew by 0.3 percent.

Going forward, the BSP will continue to ensure that the expansion in domestic creditand liquidity remains consistent with the BSP’s price and financial stability objectives.(BSP)