Preliminary data show that outstanding loans of universal and commercial banks, net of reverse repurchase (RRP) placements with the Bangko Sentral ng Pilipinas (BSP), grew at a faster rate of 8.8 percent year-on-year in February from 8.4 percent (revised) in January, said the central bank on Thursday.

On a month-on-month seasonally-adjusted basis, outstanding universal and commercial bank loans, net of RRPs, increased by 0.4 percent.

Credit activity continues to gain momentum as easing COVID-19 restrictions drive the improvement in mobility and market demand.

Outstanding loans to residents, net of RRPs, rose by 8.8 percent in February from 8.6 percent (revised) in the previous month with the acceleration in loans for production activities.

Outstanding loans for production activities went up by 9.7 percent in February from 9.5 percent (revised) in January driven by the increase in credit for real estate activities (16 percent); wholesale and retail trade, repair of motor vehicles and motorcycles (5.7 percent); information and communication (33.3 percent); financial and insurance activities (13.2 percent); manufacturing (11 percent) and electricity, gas, steam and air-conditioning supply (0.4 percent).

Likewise, consumer loans to residents increased slightly by 0.9 percent in February following a 0.4-percent decrease (revised) in January, owing mainly to the year-on-year rise in credit card loans. Outstanding loans to non-residents also went up by 7.3 percent in February from 3.2 percent (revised) in January.

The BSP continues to see scope to safeguard the momentum of economic recovery amid increased uncertainty, even as indications of sustained improvement in credit activity allows the BSP to gradually unwind its pandemic-related interventions.

Looking ahead, the BSP stands ready to adjust its monetary policy settings in ensuring non-inflationary and sustainable growth, in line with its price and financial stability mandates. BSP