Resources held by banks, which represents the amount of cash the financial system has for loans to the public, rose by nearly 10 percent in the first quarter of the year, reflecting the domestic economy’s strength.
Data released by the Bangko Sentral ng Pilipinas (BSP) Monday showed that resources held by major universal and commercial banks rose by 8.96 percent to a near record high of P10.25 trillion.
This was the second highest number on record after December 2014’s P10.39 trillion. Deposits in banks that are bulk of the industry’s resources typically rise during the holiday season due to annual bonuses for employees and higher sales for companies.
Resources held by the financial system, including nonbanks such as lending companies and pawnshops, rose by 8.56 percent to P14.28 trillion, while money held by all banks rose by 9.06 percent to P11.39 trillion.
Data for the entire financial system is skewed due to the lack of fresh information on nonbanks, and thrift and rural banks.
The availability of resources for lending ensures that economic activity, such as purchases of new homes and cars for consumers, or the expansion of businesses, remains well-funded.
Outstanding loans of commercial banks, net of reverse repurchase (RRP) placements with the BSP, rose by 13.7 percent in March, slower than the 15.2 percent growth recorded in February.
Similarly, bank lending inclusive of RRPs grew by 13.2 percent in March from 14.6 percent in the previous month, regulatory data showed.
Four of every five pesos lent out by banks at the end of March went to so-called productive sectors of the economy that contribute to job creation.
The growth in production loans was driven primarily by lending to the following sectors: Real estate, renting, and business services (10.1 percent); manufacturing (11.4 percent); wholesale and retail trade (12.6 percent); electricity, gas and water (14.2 percent); and financial intermediation (19.3 percent).
Loans for household consumption expanded by 18.8 percent in March from 21.1 percent in February amid continued growth in credit card loans, auto loans and other types of loans.