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Record-high bank loans fuel economy, pump P15T to industries


Boosted by a 26-month record high in June, double-digit growth of bank loans to various industries from December 2010 to June 2011 pumped up to P15.39 trillion in funds for economy-boosting activities and helped ease inflation pressures, according latest data of the Bangko Sentral ng Pilipinas (BSP). Total bank loans as of June reached P2.59 trillion, up 18.8 percent, the fastest pace since April 2009. "The sustained expansion in bank lending during the month supports the view that financial conditions are stable and that the domestic economy is growing within a sustainable economic path," BSP Governor Amando Tetangco Jr. said. Production loans in June accounted for 91 percent or P2.59 trillion of total bank lending while the P206-billion remainder were consumer loans, mostly in the form of credit card receivables, auto loans, and housing loans.

Trend line by Earl Rosero, GMA News
"The sustained expansion in bank lending during the month supports the view that financial conditions are stable and that the domestic economy is growing within a sustainable economic path," Tetangco said. The banks’ production loans have been above P2 billion monthly since November last year, when the growth rate for that loans category was at 9.9 percent. Production loans expanded by double-digits the following month, steadily rising every month, then jumping to 20.6 percent in June. Lending accelerated despite the slower-than-expected 4.9-percent economic growth in the first quarter of the year. Manufacturing firms obtained the most loans from November 2010 to June 2011, totaling P3.19 trillion. The next biggest chunk went to the Real Estate, Renting and Business Services firms, in the amount of P2.99 trillion. Agriculture, hunting and forestry companies secured P2.78 trillion pesos in production loans while wholesale and retail merchants availed of P2.12 trillion in bank financing. Utilities firms received P1.63 trillion in bank loans while financial intermediaries channeled credit worth P1.44 trillion.— ELR/VS, GMA News
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