KUALA LUMPUR: Moody's Investors Service sees a stable outlook for the Malaysian banking system over the next 12 to 18 months as a supportive operating environment and comfortable capital levels outweigh concerns over high household leverage and increasing margin pressure from competition.
“The healthy state of the operating environment, as reflected in our assumption that gross domestic product (GDP) will grow at 5% to 6% and unemployment will stay at around 3.3% in 2011 to 2013, underpins the sector's sustainability in earnings, based specifically on revenue growth and low provisioning costs,” said Moody's assistant vice-president Karolyn Seet said in a statement accompanying a report entitled Banking System Outlook Malaysia yesterday.
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