Bank lending grew at a slower pace in December 2025, as the confidence crisis triggered by a widening corruption scandal tempers the impact of a low-interest rate environment.
Latest data from the Bangko Sentral ng Pilipinas (BSP) showed outstanding loans from big banks grew by 9.2 percent year-on-year to P14.3 trillion during the final month of 2025. This was the softest annual expansion since the 8.6-percent increase recorded in February 2024.
Lending to businesses rose 8 percent to P12.1 trillion in December, the weakest pace in 20 months. Loans to manufacturing firms fell 9.4 percent.
Lending to construction companies—many affected by the pullback in public spending—contracted by 5.4 percent.
The consumer segment continued to borrow, with retail loans rising a solid 21.4 percent to P1.9 trillion. This was driven by credit card and auto lending. Even so, the pace of growth was the slowest in nearly three years.
“The BSP’s rate cuts are thus rowing against a strong headwind,” Leonardo Lanzona, an economist at Ateneo De Manila University, said.
“Monetary policy can make credit cheaper, but it can’t restore business and consumer confidence when the underlying political and institutional environment is deteriorating,” he added. (Ian Nicolas P. Cigaral © Philippine Daily Inquirer)
