Maybank IB opines that the banking industry loan growth continues to be robust, recovering from a low base last year. In its analysis report, the research house said banks remain upbeat on the growth of their loan this year and following from the recent results reporting season, Maybank IB raised its 2022 loan growth forecast to 6.2% from 5.2%, and our 2023 industry loan growth forecast to 4.8% from 4.5%.
In essence, it maintains a POSITIVE on the sector with BUYs on AMMB, CIMB, ABMB, HLBK and RHB. Industry loan growth was marginally faster at 6.5% YoY in Oct 2022 versus 6.4% YoY in September. Household loan growth was, however, marginally slower at 6.3% YoY (6.6% YoY in Sep) while non-HH loan growth gathered pace to 6.9% from 6.2%. The consumer sector saw softer loan growth across all major segments except for non-residential property financing. Working capital financing sustained momentum, up 8.6% YoY in October versus 8.5% in September.Credit growth of 6.6%
Loan applications rose at a slower pace of 13% YoY in October versus 34% YoY in Sep 2022. Compared to Sep 2022, consumer loan applications were lower across all major categories. Positively though, working capital loan applications continued to rise MoM for the fifth consecutive month.
Cumulative bond issuances in 10M22 amounted to MYR97b vs MYR91b in 10M21 (+7% YoY). Including bank loans, total industry credit growth was 6.6% YoY in Oct 2022, faster than 6.0% YoY in Sep 2022.
It also noted that current account and savings account growth still subdued, rising just 4.5% YoY versus 3.7% YoY in Sep 2022. The industry’s CASA ratio was lower at 30.5% end-Oct 2022 from 30.6% end-Sep 2022. Impaired loans rose marginally MoM and are up 14.3% YTD. Amid faster loan growth, however, the industry’s gross impaired loans ratio was stable at 1.82% in Oct 2022.
