Private sector credit growth grew 2.10 percent on a year-to-year in the month of February according to a macroeconomic outlook report released by Genghis Capital.
The growth was mainly attributed to substantial loan repayments in the transport and communication sector.
Manufacturing, real estate and trade sectors, which are in the top four private sectors with highest aggregate credit, grew 13.1, 8.30, and 5.90 percent on a year-to-year basis respectively.
The gradual slowdown in private sector credit growth has been attributed to:
- Reduction in credit demand due to sluggish performance of some economic sectors;
- Tightening of credit standards due to interest rate controls
- Increased usage of alternative funding sources.
“We maintain our outlook of 2.00 percent – 4.00 percent growth in private sector for the year,” said Genghis.