Demand for real estate loans on the rise — BSP

CEBU, Philippines —  Aside from the rising demand for social health related loans, banks also reported a growing interest on real estate related loans.

Latest report from Bangko Sentral Ng Pilipinas (BSP) revealed that real estate loans availed of by creditors from universal and commercial banks in November 2020 contributed to the easing up of over-all production performance of the country’s banking sector.

Real estate contributed 5.2 percent to the overall production loan of banks in November, catching up with human health and social work activities (45 percent) transportation and storage (8.1 percent), and information and communication (6.5 percent).

Electricity, gas, steam, and air conditioning supply also contributed 2.7 percent.

Consumer loans grew at lower rate of 7.1 percent in November from 7.9 percent (revised) in October due largely to the slowdown in credit card loans and the continued contraction in motor vehicle loans during the month.

Preliminary data showed that growth of outstanding loans of universal and commercial banks, net of reverse repurchase (RRP) placements with the BSP, declined to 0.3 percent in November from 1.8 percent (revised) in October.

On a month-on-month seasonally-adjusted basis, outstanding universal and commercial bank loans, net of RRPs, contracted by 0.3 percent.

Bank lending growth waned during the month as the COVID-19 crisis continued to dampen consumer spending and business activity.

Loans for production activities, net of RRPs, grew by 0.5 percent in November from 2.0 percent in October as outstanding loans to key industries declined further, particularly wholesale and retail trade and repair of motor vehicles and motorcycles  (-6.0 percent) and manufacturing (-4.2 percent).