PHL banks grow 18.8% in May, fastest in 2 yrs – BSP

Philippine banks registered the fastest growth in more than two years after expanding 18.8 percent in May on the back of increased domestic economic activities, the Bangko Sentral ng Pilipinas (BSP) reported on Monday. As of end-May, bank loans soared to P2.544 trillion or P403 billion more than the year earlier figures, BSP Gov. Amando Tetangco Jr. said in a statement. "The steady pace of domestic economic activity and stable financial conditions supported the credit expansion in May," Tetangco said. Tetangco said loans continued its uphill double-digit climb in the first few months of the year growing by 11 percent in January, 12.3 percent in February, 14.1 percent in March, 14.2 percent in April and 18.8 percent in May — the highest rate posted since April 2009. Loans extended to production activities jumped by 20.5 percent to P2.314 trillion in May from P1.92 trillion year-on-year, as firms borrowed more from banks to support their expansion bids. Tetangco said authorities will support continued credit expansion by ensuring appropriate monetary and financial conditions. "Going forward, the BSP will continue to watch evolving credit and liquidity conditions closely to ensure that bank lending growth continues to reflect the pace of domestic demand while at the same time maintaining overall price and financial stability," he said. During the period, loans to the mining and quarrying sector grew 223.5 percent, followed by electricity, gas and water with 52.7 percent; real estate, renting and business services with 21.3 percent; financial intermediation with 20.4 percent; and the manufacturing sector with 20.2 percent. The manufacturing sector, meanwhile, posted the highest amount of loans extended to a particular industry with P426.97 billion. This was followed by real estate, lending and business services (P397.25 billion); agriculture, hunting and fisheries sector (P349.38 billion); wholesale and retail trade sector (P272.96 billion); and electricity, gas and water sector (P239.33 billion). Loans extended to households, meanwhile, remained steady at 14.9 percent to P201.69 billion as of end-May, up from P175.53 billion in the same period last year. —JMT/VS, GMA News