Bank lending rose slightly in November although housing loans continued to slide, according to data out yesterday.
Loans through the domestic banking unit, which captures lending in all currencies but reflects mainly Singapore-dollar lending, came in at $692.73 billion. That was 0.5 per cent above the $689.42 billion in October.
Total borrowing rose 3.1 per cent over the same month in 2018, according to preliminary Monetary Authority of Singapore figures.
OCBC Bank head of treasury research and strategy Selena Ling said: "The improvement in the bank lending is probably part of the green shoots, which (points to) the macroeconomic stabilisation."
Loans to nearly all business segments rose, including building and construction, general commerce, business services, financial institutions, and transport, storage and communication.
Business lending hit $429.78 billion, up 6 per cent from the $405.6 billion in November 2018 and 0.7 per cent ahead of October.
Associate Professor Lawrence Loh from the National University of Singapore Business School said: "The rise in bank lending, particularly for many business segments, is a good sign as companies do see growth opportunities ahead - the expected gains are greater than the costs of borrowing."
But loans to manufacturing businesses and the agriculture, mining and quarrying sector declined.
Manufacturing lending slipped marginally from $26.93 billion in October to $26.86 billion in November.
Ms Ling said: "The recovery in manufacturing remains very tentative as the November industrial production data illustrates. So it is not surprising that loans to the manufacturing sector remain tepid. The manufacturing Purchasing Managers' Index is still in contraction territory."
Consumer loans edged up slightly in November at $262.95 billion compared with October's $262.65 billion, but were down 1.3 per cent year on year.
Housing and bridging loans continued to decline, slipping 0.1 per cent from October to November.
Lending for this segment stood at $200.94 billion in November, 1.5 per cent lower than from a year earlier.
Prof Loh said: "The fall in home loans reflects a continued cautiousness by buyers in the face of economic uncertainties. It is also due to effects of the property cooling measures."
Moving forward, Ms Ling said there could be a modest recovery for bank lending this year in line with headline gross domestic product growth.
Prof Loh added: "The recent developments in trade resolution between the United States and China augur well for business activities although it is still too early to tell if there is a clear turnaround."