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BANK-loan growth hit double-digits in December, averaging
10.1 percent to P1.695 trillion, from growth of only 6.8
percent the previous November.
This growth is believed tentative, its path the past 12
months having been in the low single-digit level except
in October, when bank-loan growth averaged 11.1 percent.
Still, this development has an impact on where local interest
rates will likely be in the near term as bank-loan
growth is a key consideration in setting monetary
policy.
“The growth in commercial banks’ lending activity picked up
steam in December, rising by 10.1 percent year-on-year.
On seasonally adjusted month-on-month basis, this grew
by 2.5 percent, a reversal from the 2.5-percent decline
the previous month,” Bangko Sentral ng Pilipinas
Governor Amando Tetangco Jr. said in a statement.
As for many months past, the sectors that drew the most loans
from the banks were the financial institutions, real
estate and businesses as well as the community, social
and personal services sectors. The former showed greater
appetite for bank loans, averaging 28 percent to 538.17
billion in December versus only P420.42 billion a year
earlier.
The latter showed 14.7 percent more loans during the Month,
totaling P277.04 billion versus only P241.61 billion in
2005.
There was also double-digit growth in lending to the
wholesale and retail trade industry of 13.5 percent to
P219.56 billion and moderate growth in lending to the
transport, storage and communications sector of 8.8
percent to P75.29 billion and the electricity, gas and
water sector where loans extended grew by 7.7 percent to
P75.48 billion.
Loans to agriculture also grew by 2.8 percent to P97.40
billion.
The loan growth in these sectors were partly offset by
contractions in mining and quarrying by 15 percent to
P9.68 billion; manufacturing, by 8.7 percent to P376.82
billion and the construction sector whose loans
retreated by 0.8 percent to P25.87 billion.
Bank loans have posted anemic growth ever since 1997 when the
Philippines
suffered from the fallout of the regionwide financial
crisis.
Banks have also been shy in granting any more loans than
necessary, considering the punitive impact on their
capital for incurring additional nonperforming assets.
The BSP forces banks to set aside a portion of their assets
as buffer for a given amount of loans outstanding that
have since fallen past due. |
