Philippine banks expect steady credit standards and loan demand in Q4

According to the latest Senior Bank Loan Officers’ Survey from the Bangko Sentral ng Pilipinas (BSP), most Philippine banks anticipate that credit standards and loan demand will remain stable during the fourth quarter.

Regarding enterprise loans, 80.8 percent of surveyed banks expect credit standards to remain unchanged. The bias toward tightening standards for enterprises has moderated to 17.3 percent, down from 28.8 percent in the third quarter. For household loans, 85.7 percent of banks expect steady standards, with the expectation of tightening falling to 11.4 percent from 17.1 percent in the previous quarter.

In terms of demand, 69.2 percent of banks expect enterprise loan demand to remain unchanged, while 26.9 percent anticipate an increase. The BSP noted that rising enterprise demand may be driven by financing needs for inventories, accounts receivable, and limited access to alternative funding. For households, banks cited higher consumption, improved financing terms, and increased housing investment as drivers for stronger loan demand.