Singapore: Bank lending dips in Jul 19, weighed down by fall in business loans

  • A drop in business loans was the main drag to total bank lending in Jul 19, even as housing loans continued to slide for the seventh straight month.
  • Bank lending in Singapore dipped 0.9% to SGD680.7bn in Jul 19 from Aug 19, on broad weakness across both business and consumer loans. This is its first decline after five months of growth, going by preliminary data from the Monetary Authority of Singapore (MAS). But y/y, loans are up 2%.
  • The slide in bank lending in Jul 19 from Jun 19 before came on the back of falling business loans, which fell 1.3% to SGD418.01bn, reversing from the growth streak of the past six months.
  • General commerce loans slid the most, falling by 4.6% month-on-month, followed by loans to financial institutions, which were down by 3%. The manufacturing sector also saw a 2.7% dip in bank lending, as the US-China trade war continued to weigh on sentiment.
  • However, some segments held up. Loans to building and construction, for example, rose 0.7%; loans to the transport, storage and communication sector grew 1.7%.
  • On that note, CIMB Private Bank economist Song Seng Wun pointed out that, even as overall business loans fell month on month, the performance by the various industries was still a mixed bag.

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