Total loans increase by 15bn
In terms of percentage growth by sector, loans to transport sector registered the highest growth with 89.99% increase followed by loans to trade and commerce with 72.16% as of June 2016
The financial sector’s total loan to the economy increased by Nu 15bn from June last year to June 2016.
As per the financial sector performance review report of Royal Monetary Authority (RMA) June 2016, financial institutions gave a total loan of Nu 71.51bn as of June 2015. The figures increased to Nu 86.60bn as of June 2016, indicating a 21% growth.
The increase in the amount of loan disbursed was attributed to strong demand towards the trade and commerce and housing sector. In substantial terms, the trade and commerce sector took the highest of Nu 19.37bn followed by the housing sector with Nu 19.24bn. The service and tourism sector followed suit with Nu 11.32bn in total loans.
However, in terms of percentage growth by sector, loans to transport sector registered the highest sectoral growth with 89.99% increase followed by loans to trade and commerce with 72.16% as of June 2016.
According to the RMA report, of the total loan, banks provided Nu 86.60bn loans while nonbanks gave the remaining Nu 15.17bn.
The total loans and advances provided by the banks increased from Nu 61.37bn to Nu71.44bn indicating a growth of 16.40%. Similarly, the total loans and advances of non-banks increased from Nu 10.14bn in June 2015 to Nu.15.17bn during the period under review.
The Non Performing Loans (NPL) of the financial sector increased from Nu 6.77bn in June 2015 to Nu 7.88bn in June 2016, indicating an increase of 16.41%. In terms of figures, the NPL of the banks increased to Nu 7bn from Nu 5.97bn as against the increase in the total loans from Nu 61.37bn to Nu 71.44 bn during the period under review.
Trade and commerce had the highest NPL followed by service and tourism and manufacturing sectors. The total deposit base of the banks increased from Nu 71bn in June 2015 to Nu 82.47bn in June 2016. The increase in deposit was mainly attributed to the increase in time deposit and demand deposit.
The total asset of the financial sector increased from Nu 107.47bn in June 2015 to Nu 124.36bn in June 2016. The increase in asset was mainly attributed to the increase in loans and advances and investments in corporate bond and equity.