The Bangko Sentral ng Pilipinas (BSP) has released its latest Senior Bank Loan Officers' Survey (SLOS), revealing that most banks in the Philippines anticipate keeping their lending standards unchanged in the second quarter of 2026. This indicates continued credit support for the domestic economy amid global uncertainties, particularly the ongoing Middle East conflict.
Business Loan Standards
For business loans, 61.5 percent of respondent banks expect lending standards to remain unchanged in Q2 2026. Meanwhile, 30.8 percent anticipate tighter standards, and 7.7 percent foresee easing. This compares with the first quarter of 2026, when 71.2 percent expected no change, 26.9 percent expected tightening, and 1.9 percent expected easing.
Household Loan Standards
For household loans, 65.7 percent of banks expect no change in lending standards, while 28.6 percent predict tighter rules and 5.7 percent expect easing. In the previous quarter, 77.8 percent expected unchanged standards, 16.7 percent anticipated tightening, and 5.6 percent projected easing.
Methodology and Indications
Under the BSP's modal method, which tracks the dominant response, most banks still expect lending standards to remain steady for both sectors. The diffusion index method, which measures the gap between banks expecting tighter standards and those expecting easing, showed a 23.1 percent net tightening outlook for business loans and a 22.9 percent net tightening expectation for household loans.
Loan Demand Outlook
Banks also expect loan demand to remain largely stable in Q2. For enterprises, 53.8 percent of banks said demand would likely remain unchanged, while 34.6 percent expect higher demand and 11.5 percent foresee weaker demand. For households, 52.9 percent expect stable demand, while 23.5 percent each expect either an increase or a decrease. By diffusion index, banks project a 23.1 percent net increase in business loan demand, while household loan demand is expected to post zero net growth.
The survey suggests that banks remain cautious but broadly supportive of lending activity as businesses and consumers navigate economic pressures. The steady credit outlook is seen as a positive sign for the Philippine economy, which continues to face headwinds from global geopolitical tensions and inflationary pressures.
