The profitability and productivity problem that has been plaguing the banking industry as of late has become a contentious and puzzling point of discussion in recent times. The purpose of the study was to evaluate the lending activities of private commercial banks in the four (4) cities that make up Region 02. This study's objective is to identify the relevance of bank policies and processes, in addition to the difficulties that these institutions faced during the course of their lending operations at private commercial banks. The research will be carried out in order to meet this objective. This conclusion suggests that as a general policy, the terms and conditions are highly important to private commercial banks. This is because without terms and conditions, the lending business of private commercial banks would not be viable as a business enterprise for the financial stability of banks. The personnel of the banks that have a capitalization of more than one hundred million pesos is sufficient to handle the lending and credit needs of borrowers. These banks are considered to be "big" banks. The policies and procedures that banks follow in the lending operation are outlined in Loan Operation Manuals, which are kept by the banks as a guidance. The policies and procedures that a bank follows when it comes to lending are generally vital to the bank's lending operations.