KUALA LUMPUR, Sept 30 — The banking system continues to record a strong liquidity coverage ratio (LCR) with excess liquidity buffers standing at RM220 billion.

Bank Negara Malaysia (BNM), in its Monthly Highlights — August 2020 report released today, said ample liquidity in the banking system is supportive of lending activities and for banks to meet exigent needs.

"Loan-to-fund and the loan-to-fund-and-equity ratios remained stable at 82.2 per cent and 71.7 per cent, respectively, on the back of sustained growth in deposits,” it said.

BNM also noted a sustained expansion in net financing.

Net financing expanded by 4.2 per cent in August (July: 4.1 per cent), supported by both outstanding corporate bonds (August: 3.9 per cent, July: 3.0 per cent) and loans (August: 4.4 per cent; July: 4.5 per cent).

Meanwhile, household loan growth increased to 4.8 per cent (July: 4.3 per cent). Disbursements remained steady despite moderating slightly from the high level in July, mainly in loans for the purchase of residential property.

However, outstanding business loan growth moderated to 3.3 per cent (July: 3.9 per cent) amid lower disbursements for working capital financing. — Bernama