<\/p>\n
S&P expects loan growth to slow to 4%-5% over the next two years.<\/p>\n
Malaysia\u2019s banking sector is facing a dip in credit demand and slower loan growth over the next two years but should be able to sustain good profitability.<\/p>\n
“We expect a dip in credit demand, resulting in slower loan growth of 4%-5% over the next two years,” said S&P Global Ratings credit analyst Nikita Anand.<\/p>\n
Corporate sector loan growth will be tempered by tough external conditions and some refinancing demand being mopped up by the bond markets, where rates are lower, the ratings agency said.<\/p>\n
In contrast, retail loan growth should stay robust thanks to low unemployment rate and rising wages.<\/p>\n
Overall, however, Malaysian banks are in strong shape to manage external risks thanks to their adequate capital buffers and loan loss coverage, S&P said.<\/p>\n
Banks are expected to sustain good profitability over the next two years.<\/p>\n
\u201cWe forecast return on assets to stay stable at about 1.4%, although risks are firmly on the downside. The impact of the recent rate cut will be broadly offset by a lower reserve requirement ratio and banks’ active management of funding costs, in our view,\u201d it said,<\/p>\n
Banks\u2019 active management of funding costs will counter the impact of heightened competition for loans and deposits, said Anand, although strength of retail deposit franchise will be a key differentiator.<\/p>\n
Malaysian banks’ retail-oriented loan portfolio limits the direct impact from higher tariffs, according to S&P.<\/p>\n
\u201cHowever, some small businesses and low-income households could come under pressure,\u201d the report warned.<\/p>\n
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S&P expects loan growth to slow to 4%-5% over the next two years. Malaysia\u2019s banking sector is facing a dip in credit demand and slower loan growth over the next two years but should be able to sustain good profitability. “We expect a dip in credit demand, resulting in slower loan growth of 4%-5% over […]<\/p>\n","protected":false},"author":1,"featured_media":4831,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-4830","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-bez-rubriki"],"featured_image_src":{"landsacpe":["https:\/\/relinvestmentsgroup.com\/wp-content\/uploads\/2025\/09\/Kuala-Lumpur-54-614x445.jpg",614,445,true],"list":["https:\/\/relinvestmentsgroup.com\/wp-content\/uploads\/2025\/09\/Kuala-Lumpur-54-463x348.jpg",463,348,true],"medium":["https:\/\/relinvestmentsgroup.com\/wp-content\/uploads\/2025\/09\/Kuala-Lumpur-54-300x225.jpg",300,225,true],"full":["https:\/\/relinvestmentsgroup.com\/wp-content\/uploads\/2025\/09\/Kuala-Lumpur-54.jpg",614,460,false]},"_links":{"self":[{"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/posts\/4830","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/comments?post=4830"}],"version-history":[{"count":1,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/posts\/4830\/revisions"}],"predecessor-version":[{"id":4832,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/posts\/4830\/revisions\/4832"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/media\/4831"}],"wp:attachment":[{"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/media?parent=4830"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/categories?post=4830"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/relinvestmentsgroup.com\/en\/wp-json\/wp\/v2\/tags?post=4830"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}