AmInvestment Bank Bhd reports that the year-to-date (YTD) annualized loan growth in the banking industry is 5.4%, which is within the predicted growth range of 4.0–5.0% for 2024.
The bank stated in a research note released today that faster growth in household and non-household loans was the main driver of the industry’s loan growth, which increased by 6.0 percent year over year (y-o-y) in March 2024 compared to 5.8 percent in February 2024.
“With consistent growth in mortgage and personal loans, household loan growth was slightly higher at 6.3% y-o-y in March 2024 compared to 6.2% a month earlier,” the report stated.
The bank reported that the rise in non-household loans in March 2024 increased to 5.5% year over year from 5.3% in February 2024. This increase was primarily ascribed to a faster rate of lending to the sectors of transportation, storage, communication, finance, insurance, and business services.
“While loan applications continued to move slowly, there was an improvement in the number of non-household loan approvals in March 2024.
“Loan approvals in the overall banking system moved negatively 12.3% year over year in March 2024 compared to negatively 18.6% year over year in February 2024,” the statement stated.
According to AmInvestment Bank, there was a decrease in loan impairments and provisions in March 2024.”The gross impaired loan and net impaired loan percentages for the industry held steady at 1.6% and 1.1%, respectively.
“In March 2024, the industry’s outstanding impaired loans decreased by 0.7% on a monthly basis, or RM259 million,” the report stated.
The Monetary Policy Committee will meet again on May 9, 2024, with the overnight policy rate expected to stay at 3.0 percent. Overall, the bank kept a “neutral” call on the industry.
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