The local banking industry as a whole has been able to sustain positive returns during the first half of 2016, despite operating in a challenging and uncertainty-laden environment, posting a Pre-Tax ROE of 7.1%. Given the current bleak economic forecasts, banks will likely continue to embrace a de-risking, deleveraging and cost rationalization strategy in the local market. In this issue, a review of macro consumption trends will be presented, highlighting the relative stability of personal consumption vis-à-vis investments and government spending. Subsequent sections will also examine the amount of loan originations and balances of consumer loans and leases (i.e. credit cards, other revolving credit plans, auto loans, and other consumer loans and leases). Consumer loan originations have been gaining a greater share of total loan originations, increasing from 26% in 2012 to 35% in YTD 2016 (13% in 2005), while consumer loan balances as a per cent of total balances increased to 19% from 15% in 2012. Given the generally higher net interest margin of consumer loans and stable net charge-off rates, this segment has become materially important for banks’ profitability.