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Banking Affin IB Research projects slower loan growth rate of 9.5% in 2014
by Cals Thu 02 Jan 2014, 09:10
| Banking Affin IB Research projects slower loan growth rate of 9.5% in 2014 |
| Business & Markets 2013 |
| Written by theedgemalaysia.com |
| Thursday, 02 January 2014 08:32 |
KUALA LUMPUR (Jan 2): Affin IB Research maintained its Overweight rating on the banking sector but is projecting a slower loan growth rate of 9.5% in 2014 due to Bank Negara Malaysia’s (BNM) recent spate of macroprudential measures to curb household loan growth.
In a note Thursday, the research house said Nov 2013 system loans grew at a steady rate of 9.9% year-on-year (versus 9.5% y-o-y in Sept 2013) while system financing grew by 9.2% y-o-y (versus 9.1% y-o-y in Sept 2013).
“Although the annualized loan growth stood at 9.8% as at November 2013, in-line with our 2013 loan growth projection of 10% y-o-y, we are however projecting a slower loan growth rate of 9.5% in 2014 due to BNM’s recent spate of macroprudential measures to curb household loan growth.
“In 2014, the rollout of ETP projects and the spillover effects to other business sectors are expected to be drivers sustaining the growth in system loans.
“Asset quality, though remains healthy with a gross and net impaired loan ratio of 1.98% and 1.36%, saw a 4.3% y-o-y growth in impaired loans, largely caused by a spike up of delinquent loans in the manufacturing (+32.6% y-o-y). Maintain Overweight on the sector. Our top pick is Maybank (Add, PT RM11.16),” it said.
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