Economy: The Bangko Sentral ng Pilipinas (BSP) reported yesterday that bank lending continued to post double-digit growth in April despite the economic slowdown experienced in the first quarter of the year.
BSP Governor Amando M. Tetangco Jr. said in a statement that bank loans grew 14.2 percent to P2.423 trillion as of end-April from P2.121 trillion as of end-April last year.
“The steady growth in bank lending reflects the prevailing pace of domestic economic activity,” Tetangco stressed.
This was the fourth straight month that bank lending posted a double digit growth after expanding by 11 percent in January, 12.3 percent in February, 14.1 percent in March, and 14.2 percent in April.
Economic managers through the Cabinet level Development Budget Coordination Committee (DBCC) see the country’s domestic output as measured by the gross domestic product (GDP) growing between seven percent and eight percent this year and next year.
The country’s GDP posted a surprising growth of 7.6 percent last year after slackening to 1.1 percent in 2009 from 3.8 percent in 2008 due to the full impact of the global financial crisis.
As expected, the country’s GDP growth slowed down to 4.9 percent in the first quarter of the year from the revised 8.4 percent in the same quarter last year due to government underspending as well as the weak global trade.
Despite the economic slowdown, loans extended to productive activities grew 15.7 percent to P2.187 trillion as of end-April from P1.899 trillion in the same period last year as corporate borrowers sourced more loans from banks to bankroll their expansion programs.
In terms of growth, data showed that loans to the mining and quarrying sector posted the biggest growth of 74.2 percent followed by the electricity, gas, and water with 47.3 percent, and the manufacturing sector with 19.5 percent.
In terms of amount, the manufacturing sector got the biggest share with P406.18 billion followed by the real estate, lending and business services with P385.9 billion; the agriculture, hunting, and fisheries sector with P344.38 billion; wholesale and retail trade sector with P269.1 billion; and the electricity, gas, and water sector with P215.3 billion.
Tetangco also reported that the growth in the loans extended for household consumption was steady at 12.9 percent to P199.41 billion in end-April from P176.59 billion in the same month last year.
Data showed that credit card loans went up by 7.6 percent to P120.5 billion from P111.95 billion while auto loans jumped 27.3 percent to P62.2 billion from P48.86 billion.
The BSP chief pointed out that authorities would ensure appropriate monetary and financial conditions for continued credit expansion while promoting the BSP’s primary mandate of maintaining price stability.
“Going forward, the BSP will contiue to provide the appropriate credit conditions to support its primary mandates of maintaining monetarya and financial stability ,” Tetangco added.
A BSP survey showed companies are still planning to expand their operations and hire more workers in the Philippines this year despite the projected easing in economic growth this year.
BSP director for Department of Economic Statistics Rosabel Guerrero said one of every four respondents of the Business Expectations Survey (BES) for the second quarter 2011 indicated plans to expand their operations.
“About one for every four respondents in the industry sector ir 24.7 percent indicated expansion plans for the third quarter,” Guerrero stressed.
However, she explained that the percentage of respondents that signified their intention to expand their operations went down to 24.7 percent in the second quarter of the year from 33.9 percent in the first quarter.
In terms of Employment Outlook Index of the survey, Guerrero said the number of respondents who expected to continue hiring in the third quarter declined to 14.5 percent in the second quarter from 23 percent in the first quarter
