Bank lending drops in January on back of weak business loan demand

Lending to most business sectors dropped in January.

Overall bank lending in Singapore dropped 1.2% year-on-year to $600.2 billion in January, compared to $607.5 billion in the same period last year.

Preliminary statistics from the Monetary Authority of Singapore (MAS) show that the contraction was mainly on back of a decline in business loans. Lending to businesses fell to $357.3 billion in the first month of the year, compared to $370.3 in the same period last year.

The decline in business lending was broad-based, with most sectors reflecting lower demand in January. Only two sectors booked lending growth in the first month of the year, namely include building and construction and transport, storage and communication.

On the other hand, consumer lending ticked up to $242.9 billion in January, compared to $237.2 billion in the same period last year. The increase was mainly on back of growth in housing and bridging loans, as well as an increase in share financing.

Bank lending was flat on a month-on-month basis.