M3, bank lending pick up in Dec
Credit to Author: Mayvelin U. Caraballo, TMT| Date: Wed, 05 Feb 2020 16:50:22 +0000
THE growth of the country’s money supply continued to accelerate amid the faster rise in bank lending, data from the Bangko Sentral ng Pilipinas (BSP) showed on Wednesday.
In a statement, the central bank said domestic liquidity (M3) expanded by 11.4 percent year-on-year to P13 trillion last December, faster than November’s 9.8 percent. Month-on-month and seasonally adjusted, M3 increased by 1.6 percent.
Domestic claims grew at a faster 10.5 percent from November’s 8.3 percent, “due mainly to the sustained growth in credit to the private sector,” it added.
Net claims on the central government jumped by 24.4 percent from 13.9 percent the month before, “due in part to the decline in deposits by the national government with the BSP,” the Bangko Sentral said.
Net foreign assets in peso terms, meanwhile, climbed by 8.8 percent from the previous month’s 11.5-percent growth.
“Demand for credit remained the principal driver of money supply growth,” the central bank said.
Bank lending growth also accelerated to 10.9 percent in December from 10.1 percent a month earlier.
On a month-on-month and seasonally adjusted basis, commercial bank loans grew by 1.3 percent.
Lending for production activities, which accounted for 87.4 percent of the aggregate loan portfolio, leaped by 9.1 percent, faster than the reported 8.1-percent growth in November.
The sustained increase in production loans was driven primarily by lending to real estate activities (19.7 percent); financial and insurance activities (17.2 percent); electricity, gas, steam and air conditioning supply (8.3 percent); construction (23.4 percent); and information and communication (12.9 percent).
Bank lending to other sectors also increased during the month, except those in manufacturing (-1.9 percent); mining and quarrying (-11.0 percent); professional, scientific and technical activities (-4.6 percent); and other community, social and personal activities (-21.7 percent).
Loans from universal and commercial banks for household consumption grew by 27.5 percent last December, quicker than 26.6 percent last November, “due to faster growth in credit card and salary-based consumption loans during the month,” the BSP said.
With the latest data, the Bangko Sentral said it “will continue to ensure that the expansion in domestic credit and liquidity remains consistent with the BSP’s price and financial stability objectives.”