RETAIL BANKING | Staff Reporter, Malaysia

Malaysian banks' interest spreads suddenly contract to 1.49% in June

But we have yet to see if this is a trend.

Maybank Kim Eng reported that interest spreads suddenly dipped to 1.49% in June from 1.63% in May. Whilst average fixed deposit rates were stable at 2.98%, lending yields dropped to 4.47% from 4.61%.

"It remains to be seen if this is a trend, but we are expecting a contraction in industry NIMs in 2H17, primarily on the back of higher funding costs, for deposit competition seems to have heated up."

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