Malaysian banks' NPLs rose 1.9% in September

Blame it on nonresidential property NPLs.

According to Maybank Kim Eng, absolute NPLs rose 1.9% MoM led by an 8.3% MoM increase in nonresidential property NPLs and a 4% MoM increase in working capital NPLs. On a YoY basis, however, absolute NPLs were flat (-0.4%).

It adds that the industry’s gross NPL ratio was relatively stable at 1.62% end-Sep 2015 vs 1.60% end-August with a loan loss coverage ratio of 98.1% versus 97.6%.

"On a segmental basis, the NPL ratios have been rising over the past few months in the non-residential property and credit card segments. The former has seen its gross NPL ratio rise from 0.75% end-Dec 2014 to 0.96% end-Sep 2015 while the aggregate credit card NPL ratio was 1.35% end-Sep 2015 vs 1.21% end-Dec 2014. The gross NPL ratio for working capital, meanwhile, has risen over the past two months from a low of 2.27% endJul 2015 to 2.41% end-Sep 2015."