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WHOLESALE BANKING | Cesar Tordesillas, Malaysia

Malaysian banking system posts solid numbers

Malaysia’s banking system capitalisation remained strong with the risk-weighted capital ratio and core capital ratio at 14.9% and 12.9%.


According to Bank Negara, the level of net impaired loans had improved, amounting to 1.8% of net loans while the loan loss coverage ratio remained high at 99.6%.

It added that interbank rates were stable in December.

In terms of retail rates, the average base lending rate of commercial banks moderated slightly to 6.53% as at end-December. Broad money increased at a higher annual rate of 14.4% in December due mainly to an increase in credit extended to the private sector and higher capital inflows.

Net financing to the private sector grew at a slower pace in December due mainly to lower net private debt security issuances. Outstanding banking system loans expanded by 13.6% with a higher amount of loans being extended to businesses in the wholesale and retail, restaurants and hotels, manufacturing, transport, storage and communication and real estate sectors.

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