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Andy Mukherjee

Malaysia's Strange, Sinister Crunch

It's unnatural for loan writing to run ahead of deposit taking for so long.
Photographer: Charles Pertwee/Bloomberg
Updated on

Something weird is going on at Malaysia's banks. And no, it has nothing to do with the 1MDB money-laundering scandal.

The problem is about deposits, or more precisely, a lack of them. As CIMB Group Holdings Bhd. analyst Winson Ng notes, the banking industry's loans-to-deposit ratio has gone from 76 percent in February 2012 to 90 percent in June. For Malayan Banking Bhd., or Maybank, the ratio is 94.7 percent, according to a press release from the lender.