Stable outlook for banks

Dynamic duo: Lee (left) and Wong are RAM Ratings co-heads of financial institution ratings. They expect industry loans to grow by a more moderate 5% this year from 5.7% last year.

PETALING JAYA: The domestic banking sector is well positioned to face potential asset quality deterioration arising from inflationary pressures, higher interest rates and the threat of slower global growth, according to RAM Rating Services Bhd.

Its co-head of financial institution ratings Wong Yin Ching, who is maintaining a stable outlook on the sector, told StarBiz the robust loss absorption buffers, diversified funding and well-controlled asset quality risks continue to anchor the banking system’s resilience.