Singapore's October bank loan growth slows 3.41% to $671.74b

Business loans rose 3.35%.

The volume of loans extended by Singapore banks rose 3.41% YoY to $671.74b in October from $649.56b, the Monetary Authority of Singapore (MAS) revealed. The latest headline figure represents a steady slowdown in loan growth from 5.6% in August to 3.5% in September. 

According to preliminary data, loans to businesses grew 3.35% from $390.70b to $405.78b in October, led by increases in building and construction (10.53% to $113.11b), business services (8.43% $9.71b), and financial institutions (1.1% to $100.83b).

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The increase in business loan volume was offset by the 5.06% decline in lending for general commerce from $69.95b to $66.41b.

Meanwhile, consumer loans sharply grew by 2.74% from $258.86b to $265.96b. Housing loands also rose 3.02% from $197.88b to $203.87b.

However, the outlook for Singapore's domestic loan book appears inreasingly dim against the backdrop of escalating US-China trade tensions, higher borrowing costs and cooling measures in the property sector, Fitch Solutions said in a research note. The credit rating agency expects loan growth to fall to 4% by end-2018 and 3% by 2019.