BNM: Net financing to private sector up RM22.3bil in May

KUALA LUMPUR: Banks' net financing to the private sector rose
RM22.3bil in May, mainly through banking system loans, to RM1,398.9bil
from RM1,376.6bil in April, according to Bank Negara Malaysia (BNM).
The
central bank said on Friday banking system loans to businesses grew for
most sectors during the month. There was an increase in loans
particularly to the real estate, finance, insurance and business
services; manufacturing and construction sectors.
"Household
loans outstanding also continued to rise steadily, driven mainly by
loans for the purchase of residential and non-residential properties,
purchase of passenger cars and personal loans," it said.
BNM said loan demand increased in May, with higher loan applications from both businesses and households.
As for the annual growth in broad money (M3), it said moderated to 13.2% in May from 15% in April.
It
said on a monthly basis, the contraction of M3 was due to higher
government fundraising activities and net foreign outflows during the
month.
However, the decline in the M3, was partly offset by the
increase of credit extended to the private sector which saw an increase
in the banks' net financing to the private sector.
BNM also said
the banking system remained well capitalised with risk-weighted capital
ratio (RWCR) and core capital ratio (CCR) at 14.6% and 12.8%
respectively.
"The level of net impaired loans improved,
amounting to 1.6% of net loans (from 1.7% in April) due to continued
recoveries and write-offs by some banks. Loan loss coverage remained
high at 93.2%.