Bank loans rose year on year for the 11th straight month in August though the pace of growth slowed for the second straight month as business lending cooled.
Total lending last month rose to $634.41 billion, up 5.1 per cent compared with $603.85 billion in August last year, according to preliminary data from the Monetary Authority of Singapore yesterday.
Bank loans have been rising year on year since October last year with growth hitting 7.6 per cent in June, the fastest in more than two years. But July saw lending momentum easing to 5.9 per cent, due mainly to slower growth in business loans and in August, it moderated again to 5.1 per cent.
Business lending in August expanded year on year for the ninth straight month to $378.16 billion, up 5.8 per cent from a year earlier. This was slower than July's 7.4 per cent and June's 10.5 per cent expansion.
Loans to building and construction firms saw little change at 0.2 per cent, which could explain why the government decided to bring forward $700m of public amenity projects to this year and 2018, noted OCBC Bank's head of treasury research & strategy Selena Ling.
Growth came mainly coming from lending to financial firms, which swelled by 12.7 per cent to $89.47 billion, and to general commerce firms which rose 10.4 per cent to $67.18 billion.
Bank loans have been rising year on year since October last year with growth hitting 7.6 per cent in June, the fastest in more than two years.
Meanwhile, consumer borrowing remained resilient, rising 3.9 per cent year on year in August to $256.25 billion, slightly higher than July's 3.8 per cent growth, led by an increase in mortgages and bridging loans which rose 4.3 per cent to reach $196.37 billion.
On a month on month basis, lending in August rose 0.3 per cent from July's $632.6 billion.
OCBC's Ms Ling said that for the first eight months of this year, bank loans have already grown 5.9 per cent year on year, which is a sharp turnaround from the 2016 performance.