Bank lending standards seen steady in Q1

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February 2, 2026 | 12:00am

MANILA, Philippines — Banks are expected to keep lending standards largely unchanged in the first quarter of 2026, even as loan demand shows signs of picking up, according to the Bangko Sentral ng Pilipinas (BSP).

Results of the Senior Bank Loan Officers’ Survey showed that 87.7 percent of banks anticipate maintaining their credit standards for loans to enterprises in the first quarter, slightly higher than the 86 percent recorded in the previous quarter.

Only a small portion of banks expect to ease lending standards at 1.8 percent, while 10.5 percent see tighter credit conditions ahead.

For household loans, 79.5 percent of banks expect credit standards to remain unchanged in the first quarter, lower than the 82.5 percent in the fourth quarter of 2025. Meanwhile, 12.8 percent of respondents expect lending standards to tighten, while 7.7 percent anticipate looser credit conditions.

The BSP noted that among banks expecting changes in lending standards, there remains a bias toward tighter credit.

A net 8.8 percent of banks expect to tighten rather than ease standards for business loans, while a net 5.1 percent anticipate tighter standards for household loans in the first quarter. This compares with higher net tightening expectations of 14 percent for business loans and 7.5 percent for household loans in the fourth quarter of 2025.

Despite steady lending standards, banks see stronger loan demand conditions ahead. For business loans, 70.2 percent of banks expect demand to remain unchanged in the first quarter, down from 80.7 percent in the previous quarter.

At the same time, 28.1 percent of respondents anticipate an increase in demand, up from 14 percent previously, while only 1.8 percent expect demand to decline.

A similar trend was observed for household loans. About 61.5 percent of banks expect household loan demand to remain steady in the first quarter, while 30.8 percent foresee an increase in demand, higher than the previous quarter’s level. Only 7.7 percent of banks expect household loan demand to fall.

The BSP said the survey covered 58 universal and commercial banks, thrift banks and rural banks, representing a 96.7 percent response rate from the institutions surveyed.

The SLOS gathers loan officers’ perceptions on overall credit standards as well as factors affecting the supply of and demand for loans to enterprises and households, with results analyzed on a quarter-on-quarter basis.