Malaysia’s Banking Sector to be Impacted by Anticipated Economic Downturn

Malaysia's RHB Investment Bank (RHB) said that the country’s banking sector is set to be affected as it expects loan growth in the country to drop to 0.4% year-on-year (YoY), with both business and household demand faltering as the economy goes into a contraction. According to RHB, Malaysia’s banking sector loan growth increased marginally to 4.0% YoY in March 2020, compared to 3.9% YoY growth in February 2020.

RHB added that growth in corporate loans increased to 4.4% YoY during March 2020, compared to 3.2% in February 2020, owing to higher disbursements of loans to most industries except for wholesale & retail and construction sectors. Meanwhile, RHB said household loans moderated to 3.7% from February&...