Bank loans increased faster and posted a double-digit growth in May 2024 despite the impact of high interest rate environment on demand.
Preliminary data from the Bangko Sentral ng Pilipinas (BSP) show that outstanding loans of universal and commercial banks (U/KBs), net of reverse repurchase (RRP) placements with the central bank, grew by 10.1 percent year-on-year in May, faster than the 9.6-percent increase in April.
It also rose 1.1 percent on a month-on-month, seasonally adjusted basis, the BSP said.
Outstanding loans, net of RRP placements, amounted to P12 trillion in May, up from P11.9 trillion in April and P10.9 trillion a year ago.
Outstanding loans to residents, net of RRPs, saw a rise of 10.2 percent, up from April’s 9.6 percent. Loans to non-residents went up at a slower rate of 8.1 percent in May from 10.8 percent in the previous month.
Loans for production activities grew 8.4 percent in May from 7.8 percent in April.
This was driven by the increase in loans to major sectors, including real estate activities (up 13.2 percent); wholesale and retail trade, and repair of motor vehicles and motorcycles (11.1 percent); manufacturing (10.1 percent); transportation and storage (26.7 percent); and electricity, gas, steam, and air conditioning supply (7.7 percent).
Consumer loans to residents expanded by 25.6 percent in May, higher than 25.3 percent in April.
This growth was mainly driven by the increase in credit card, motor vehicle and salary-based general-purpose consumption loans, the BSP said.
The BSP’s policy-making Monetary Board kept the benchmark interest rate at a record high of 6.5 percent in its last meeting.
