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SME lending surges in H2

The majority of the bank loans went to the construction industry and companies in the wholesale and retail trade

The city’s SMEs saw their new approved lending by local banks increase in the second half of 2016 compared to the first half, with those companies engaged in construction and public works being the biggest beneficiaries, according to the latest official data released yesterday by the Monetary Authority of Macau (AMCM).
In the six-month period, total new SME credit limit granted by the banking sector totalled MOP13.6 billion (US$1.7 billion), soaring by 36.8 per cent period-to-period, compared to MOP9.95 billion in the first half of the year. However, when compared to the same period in 2015, the amount dropped by 34.1 per cent.
The collateralised ratio, which indicates the proportion of credit limit with tangible assets pledged, reached 83.9 per cent as at the end of period, representing an increase of 2.34 percentage points period-to-period, or 0.21 percentage points month-on-month.
In terms of economic sectors, new lending approved to companies engaged in construction and public works accounted for 29.6 per cent of the total, rising by 3 per cent compared to the end of the first half of 2016, according to official data.
In addition, SMEs running restaurants, hotels and similar establishments also saw their lending approved by the banking sector increase by 8.3 per cent period-to-period, accounting for 3 per cent of the total.
However, new credit limit granted by banks to companies in the wholesale and retail trade went down by 2.1 per cent period-to-period to 16.8 per cent of the total, while that granted to the manufacturing industry also decreased by 16.1 per cent period-to-period, totalling 4.7 per cent of all new lending.

Credit utilisation
As at the end of the year, the outstanding value of total SME loans amounted to MOP69.8 billion, an increase of 3 per cent period-to-period, or 4.5 per cent year-on-year.
The utilisation rate thus jumped by 5.1 percentage points period-to-period to 66.8 per cent. The rate, defined as the proportion of outstanding credit balance to the credit limit granted, also represents an increase of 5.58 percentage points compared to one year ago.
Meanwhile, the outstanding balance of delinquent SME loans reached MOP578.1 million, surging by 88.7 per cent from six months earlier, according to the data. Compared to the same period in 2015, the balance also grew 57.9 per cent.
On the other hand, the delinquency ratio, a ratio of the outstanding balance of delinquent loans to total outstanding SME loans, reached 0.83 per cent as at the end of the period, increasing by 0.38 percentage points from the first half of 2016, or 0.28 percentage points from one year ago.