Credit growth slows as banks get tougher on loan applicants
The Reserve Bank reported on Thursday morning that money supply and private-sector credit growth slowed, instead of rising as expected
Money supply and credit growth slowed unexpectedly in October, which may be an indication that banks are getting tougher on loan applications. The Reserve Bank reported on Thursday morning that annual growth in private-sector credit extension slowed to 5.8% in October from 6.3% in September, instead of rising to 6.5% as economists had expected. Investec Bank economist Kamilla Kaplan tied the Reserve Bank's figures to recent data from the National Credit Regulator (NCR), which showed the rejection rate of new credit applications received rose to 50.1% in the second quarter from 48.5% in the first quarter. "This could suggest that financial institutions have tightened credit criteria towards households," Kaplan said in a note e-mailed on Thursday. Absa Home Loans economist Jacques du Toit said the portion of unsecured household debt had been steadily rising over the past decade.
Household unsecured credit amounted to R381.2bn in October, 23.7% higher than in the same month in 20...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.