deepening. strong liquidity and credit growth feeds the economy ’ s growth potential. structural reform milestones that began in the early 1990s and 2000s and continue to gather stronger pace today have translated to productivity gains over time, as reflected in higher potential output growth. if the current investment - led growth and institutional reforms are sustained, a 5 to 7 percent potential output growth for the medium - term is highly feasible. there is sufficient liquidity to fuel this, and banks are able to intermediate these funds safely. you could also ask should the market be concerned post - sda ima? if the market concern is on the headline liquidity growth number of over 30 percent, my answer would be no. the bsp has always anticipated there will be some liquidity growth after the funds under sda - ima are “ released ”. that was, after all, the game plan. we fine - tuned the sda operations so the funds could find more productive homes in industry, manufacturing and other sectors of the economy. in addition, our anticipation is that the period of high liquidity growth coming from sda - ima will not persist. if the concern is whether the liquidity will fuel an asset bubble, the answer again is no. bis central bankers ’ speeches and i think you, who know your sda clients well, will agree with me on this one. the profile of an sda investor is very different from the profile of a real estate investor. finally, risk 3 : the rest of the world? because of 1 ) trade ties with, 2 ) workers deployed to, and 3 ) tourists expected from europe, japan, china, we watch these countries with great interest. at the moment, the consensus seems to be that 1 ) europe can possibly keep its growth rate level, 2 ) japan will calibrate its stimulus, learning from the experience of the fed on the problems of exit from unconventional monetary policy, and 3 ) china will continue to grow at a steadier pace. we are monitoring these economies, but we are also mindful that our own domestic demand conditions, particularly consumption and capital formation, remain quite strong. concluding remarks ladies and gentlemen, i ’ ve laid out for you the “ facts ” and the “ perceived risks ” – three buffers against three vulnerabilities. i know i ’ ve gone thru a lot of information. i am not worried though because i know dealers are experts at multi - tasking, and are able to filter thru

( sbw s ) program. this shows that this facility is a viable and efficient means of distributing welfare benefits to indigent citizens. likewise, since its launch in april 2018, instapay exponentially grew, registering over 1. 5 million percent increase in volume and over 700 thousand percent in value as of november 2020, with the volume rising to 26. 3 million from 1, 740 transactions and the value growing to p144. 4 billion from p19. 1 billion. the performance of instapay for the pandemic year 2020 has also been impressive with a year - to - date growth rate of 446. 0 percent in volume, from 4. 8 million to 26. 3 million transactions, and 325. 0 percent in value, from p34. 0 billion to p144. 4 billion as of endnovember 2020. based on the bsp lending rates survey, quoted annualized bank lending rates of all the 46 universal and commercial banks have been generally declining particularly the lower limit. this, in turn, makes loans relative to nominal gross domestic product to rise by october 2020. based on the baseline survey, the banking system may grow by 3. 6 percent by end - december 2020. this expected growth, however, represents the top 20 banks across universal and commercial banks, thrift banks, and rural and cooperative banks. as the philippine banking system continues to support our micro, small, and medium enterprises during these difficult times, we expect loans to this sector to rise further. in particular, the banking system ’ s new micro, small, and medium enterprise loans used for compliance with the reserve requirements have averaged p143. 8 billion as of the reserve week of 17 december 2020. bank loan quality remained satisfactory amid continued loan growth. the non - performing loan ratio was manageable at 3. 7 percent as of end - october 2020, although higher than the 2. 2 percent ratio as of end - october 2019. loan loss reserves have been generally increasing since the start of last year but inched down as of end - october 2020, resulting to a lower non - performing loan coverage ratio of 89 percent. we expect the banking industry to recalibrate provisions as banks continue to reassess the quality of their respective loan portfolios. the year - on - year growth of financial assets ( aside from loans ) moved from 15. 2 percent in october 2019 to 9. 4 percent in december 2019, and up again to 12. 0 percent