Thailand
Philippines: M3 growth slows as bank lending falls
Growth of the country’s money supply slowed down in April as the pandemic continues to affect banks’ lending, the Bangko Sentral ng Pilipinas (BSP) said.
In a statement on Monday, the central bank said domestic liquidity (M3) rose by 5.1 percent year-on-year to P14.2 trillion in April, slower than the 8.3-percent increase in March. Month-on-month and seasonally adjusted, M3 improved by 0.5 percent.
Growth in domestic claims slowed to 1.8 percent year-on-year in April from 5.6 percent in the previous month.
“Bank lending to the private sector remained weak, as measures to contain the resurgence in Covid-19 (coronavirus disease 2019) cases constrained domestic economic activity and dampened market sentiment,” said the BSP.
Net claims by the government grew by 23.6 percent, lower than March’s 47.3 percent growth, “due partly to the sustained borrowings by the National Government.”
The BSP meanwhile said bank lending contracted by 5 percent in April from a -4.5 percent in March. Month-on-month and seasonally adjusted, it fell by 0.30 percent.
Loans to residents, net of reverse repurchase decreased by 4.5 percent while outstanding loans to residents dropped by 20.2 percent.
Consumer loans to residents went down by 10.2 percent after declining by 9.9 percent in March due mainly to the continued drop in credit card and motor vehicle loans.
Outstanding loans to key industries also declined, specifically to wholesale and retail trade and repair of motor vehicles and motorcycles (-10.2 percent), manufacturing (-9.8 percent), and financial and insurance activities (-6.8 percent).
The BSP, however, said the decline was partly tempered by the growth in loans to professional, scientific and technical activities (106.9 percent), real estate activities (2.4 percent), and human health and social work activities (8.5 percent).
Overall outstanding loans for production activities, net of reverse repurchase agreements, fell by 3.9 percent in April after a 3.2-percent decline in the previous month.
“Going forward, the BSP’s key priority is to preserve policy support to facilitate the recovery of the domestic economy,” said the BSP.
“The BSP thus stands prepared to take appropriate measures as necessary to ensure favorable financing conditions in support of domestic economic activity and market sentiment, consistent with its price and financial stability mandates,” it added.
Source: https://www.manilatimes.net/2021/06/01/business/top-business/m3-growth-slows-as-bank-lending-falls/1801463