Chart of the Day: Here’s solid proof that Singapore’s credit picture remains lukewarm

Loans growth fell for the 5th consecutive month.

Banks in Singapore are scraping the bottom of the barrel for loaners as bank loans fall by 1.2% in February, extending the longest streak of business loan decline since April 2000.

According to OCBC, business loans fell by 3.4% after falling by 3.5% the previous month, as loans to a number of sectors, including general commerce and manufacturing, continue to decline.

Meanwhile, only loans to building/construction and transport/storage/comms expanded in the month, growing by 16% and 2% respectively.

“Consumer loans also moderated further to 2.2% yoy (-0.3% mom) in Feb, slower than the +2.4% yoy (flat mom) in Jan, as housing/bridging loans also eased (+3.9% yoy and flat mom) and car and credit card loans also extended their ongoing slump,” OCBC said.

Meanwhile, OCBC said bank loans are expected to contract even further due to weak domestic business sentiments, with the full year in the 0-2% yoy range assuming some stabilization towards the end of 2016.