Singapore banks' loan growth improved slightly but still "lethargic": analyst

System loans increased in December for the first time in 2016.

According to Maybank Kim Eng, the increase was partly due to the low base in Dec 2015. Asset quality continued to worsen, as the percentage of exposures classified in the doubtful and loss categories are now at their highest level since 4Q09.

Here's more from Maybank Kim Eng: 

Dec system loans rose 0.5% YoY (Nov: -1.2%), the first YoY increase in 2016. Improvement in lending was broad-based across all sectors, mainly from manufacturing, building & construction, and financial institutions.

Corporate loans grew 0.6% YoY (Nov: -1.9%). However, consumer sentiment remained weak, as consumer loans rose only 0.2% YoY (Nov: +0.7%), the slowest pace since Sep 2009.

System deposits grew 4% YoY (Nov: +4.9%), with Domestic Banking Unit (DBU) and Asian Currency Unit (ACU) deposit growth at 6.5% and 1.5%, respectively (ACU growth in SGD terms). With that, system LDR tightened to 99.1% (Nov: 97.8%).