BSP: Growth in bank lending slowed to 13.4% in Dec ’22

Bangko Sentral ng Pilipinas. (File photo / Philippine Daily Inquirer)

Loans extended by the country’s large banks grew by 13.4 percent year-on-year to a total of P10.9 trillion in December 2022, slower than the 13.9 percent recorded in November as banks were more sensitive to risk during the fourth quarter of 2022.

Preliminary data at the Bangko Sentral ng Pilipinas (BSP) also show that, in December, outstanding loans of universal and commercial banks—net of short-term loans to the BSP—was 0.4 percent less compared with November.

Philippine residents borrowed 13.2 percent more, slower than the growth rate of 13.6 percent in November.

In December, loans granted to businesses grew by 12.1 percent, also slower compared to 12.6 percent in the previous month.

The biggest amount was lent to companies engaged in real estate activities, growing by 13.1 percent to P2.18 trillion; manufacturing by 14.9 percent to P1.25 trillion; electricity, gas, steam and air-conditioning supply by 14.4 percent to P1.2 trillion, and wholesale and retail trade, repair of motor vehicles and motorcycles by 12.7 percent to P1.27 trillion.

On the other hand, the growth of consumer loans to residents rose to 24.8 percent at P1.03 trillion in December from 24.2 percent in November.

Also, the growth of outstanding loans to nonresidents slowed to 20 percent after expanding by 24.6 percent in Nov. 2022.

“The sustained growth in credit activity and ample liquidity will continue to support the recovery of economic activity and domestic demand,” the BSP said in a statement.

According to the latest BSP survey of senior bank loan officers conducted between Dec. 14, 2022, and Jan. 13, 2023, banks implemented tighter lending standards to businesses due to banks’ reduced tolerance of risk and a more uncertain economic outlook.

—Ronnel W. Domingo INQ