Bank lending grows 11.4% as power loans surge

By Francis Allan L. Angelo

Outstanding loans of universal and commercial banks grew 11.4 percent year-on-year in April, faster than the 10.7 percent posted in March, the Bangko Sentral ng Pilipinas (BSP) reported June 5.

Stripped of seasonal swings, the loan portfolio rose 1.1 percent month-on-month, which the central bank linked to lenders’ expectations of steady credit demand from businesses and households in the second quarter of 2026.

Lending to residents, which makes up most of the loan book, expanded 11.8 percent in April from 11.1 percent a month earlier.

Loans for business and production activities grew 10.7 percent, up from 9.7 percent in March.

Power led the increase, with loans to the electricity, gas, steam, and air-conditioning supply sector jumping 25.8 percent year-on-year to PHP 2.04 trillion in April from PHP 1.62 trillion a year earlier.

Lending to wholesale and retail trade, and repair of motor vehicles and motorcycles rose 11.8 percent to PHP 1.66 trillion.

Loans for transportation and storage climbed 24.7 percent to PHP 626.53 billion.

Real estate loans grew 8.1 percent, manufacturing 1.0 percent, and financial and insurance activities 6.7 percent.

Consumer borrowing kept pace with corporate demand, rising 19.6 percent, though slower than the 20.5 percent recorded in March amid a moderation in credit card and motor vehicle loans.

Credit card debt remained the largest consumer segment, climbing 26.6 percent to PHP 1.25 trillion in April from PHP 985.31 billion a year earlier.

Money supply up 12.2%

Meanwhile, domestic liquidity, or M3, grew 12.2 percent year-on-year to PHP 20.3 trillion in April, broadly steady against the revised 12.1 percent recorded in March.

M3 is a broad measure of money supply that covers currency in circulation, bank deposits, and other assets readily convertible to cash.

The BSP attributed the liquidity growth mainly to sustained borrowing by nonfinancial private corporations and households.

Claims on the private sector rose 12.6 percent in April from a revised 11.9 percent in March.

Net claims on the central government increased 15.1 percent, driven by higher outstanding government securities and lower deposits with the BSP and banks.

Net foreign assets in peso terms rose 8.9 percent year-on-year, up from 8.6 percent in March, with the BSP’s own position expanding 7.9 percent.

The narrower M1 measure, covering currency in circulation and current account deposits, grew 8.6 percent, slower than the revised 9.5 percent in March.

The BSP said it would keep ensuring that liquidity and bank lending conditions stay aligned with its price and financial stability objectives.