Preliminary data show that outstanding loans of commercial banks, net of reverse repurchase (RRP) placements with the BSP, grew at a slower rate of 16.8 percent in November, from 18.1 percent in October. Likewise, the growth in bank lending inclusive of RRPs decelerated to 15.4 percent in November from 17.9 percent in the previous month. On a month-on-month seasonally-adjusted basis, commercial bank loans net of RRPs increased by 0.3 percent while loans inclusive of RRPs declined by 0.1 percent.

Loans for production activities�which comprised 88.7 percent of banks' aggregate loan portfolio, net of RRP � increased at a slower pace of 17.2 percent in November from 18.7 percent in the previous month. The growth in production loans was driven primarily by increased lending to the following sectors: wholesale and retail trade, repair of motor vehicles and motorcycles (19.7 percent); financial and insurance activities (29.4 percent); real estate activities (12.5 percent); manufacturing (16 percent); electricity, gas, steam and airconditioning supply (11 percent); and, construction (38.1 percent). Bank lending to other sectors also increased during the month.

Meanwhile, the growth of loans for household consumption slowed down to 13.8 percent in November from 14.6 percent in the previous month due to the weaker expansion in credit card loans and motor vehicle loans, as well as the contraction in salary-based general purpose consumption loans and other types of household loans.

The BSP will continue to ensure that the expansion in domestic credit and liquidity proceeds in line with overall economic growth while remaining consistent with the BSP's price and financial stability objectives.

Source: Bangko Sentral ng Pilipinas (BSP)