Lending rates were diminished from 3.25 percent to 3, in order to support commercial activities.
Described as a modern place to do business, Malaysia is at the forefront of international investment in Southeast Asia, driven by a dedicated culture of exportation and aggressive private spending. Financial conglomerates are having a good time with the notable benefits of an economy that grew 6.2 percent up to December.
The third quarter (Q3) just ended recently and there are no signs of slowdown in the overall performance of local banks. According to financial executives in Kuala Lumpur, volatility in the Malaysian market does not seem to be a problem for these institutions to keep working and growing at a healthy pace.
Various experts who spoke with us firmly believe that the moderate success of this year will be maintained in 2019, where mortgages are about to play a central role among all formal transactions. Despite some net interest income pressure due to normal uncertainties within the market, the banking sector will remain stable.
“The shock of net interest compression from deposit competition has been stopped partially by the strong growth showed in traditional loans,” said Imran Yassin, analyst from the MIDF Amanah Investment Bank.
The Malaysian Financial Reporting Standard 9 of this year prompted some expectations about credit charge going up, but that did not happen at all. On the other hand, a high margin of interest can boost interest income making general costs more viable.
An expansion seen not only in banking, but in all economic platforms. For instance, the service sector went up to 6.58 percent, computer and communications 8.79 percent and retail 7.5 percent. Resulting in a moderate upturn for finances and insurances at a 4.2 percent rate, an industry extremely tied to any impulse of the Malaysian workforce.
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