KUALA LUMPUR (Jan 31): Malaysia’s official reserve assets stood at US$116.22 billion while other foreign currency assets amounted to US$4.5 million as of end-December 2024, according to Bank Negara Malaysia (BNM).

In a statement, the central bank said that over the next 12 months, pre-determined short-term outflows of foreign currency, securities and deposits — including scheduled repayments of external government borrowings and the maturity of Bank Negara Interbank Bills — are expected to total US$10.6 billion.

Meanwhile, net short forward positions amounted to US$29.3 billion as of end-December, reflecting BNM’s management of ringgit liquidity in the money market.

“In line with the practice adopted since April 2006, the data excludes projected foreign currency inflows arising from interest income and the drawdown of project loans,” BNM noted in its detailed disclosure of international reserves on Friday.

As part of the International Monetary Fund (IMF) Special Data Dissemination Standard (SDDS) format, BNM’s breakdown of reserves provides a forward-looking view of Malaysia’s reserve composition, usability, and expected foreign exchange inflows and outflows over the next 12 months.

The central bank said projected foreign currency inflows in the next 12 months stand at US$2.5 billion.

BNM also highlighted that the only contingent short-term net drain on foreign currency assets is government guarantees on foreign currency debt due within a year, amounting to US$399.8 million.

Additionally, BNM clarified that there are no foreign currency loans with embedded options, no undrawn, unconditional credit lines with central banks, international organisations, or financial institutions, and that it does not engage in foreign currency options involving the ringgit.

“Overall, the detailed breakdown of international reserves under the IMF SDDS format indicates that as at end-December 2024, Malaysia’s international reserves remain usable,” it added.

In a separate statement, BNM said credit to the private non-financial sector — comprising loans to households and non-financial corporations from the banking system, development financial institutions, and corporate bonds issued by non-financial corporations — moderated to 5.2% in December 2024, down from 5.4% in the previous month.

This moderation was attributed to a slowdown in outstanding business loans, which decreased to 5.1% in December from 5.4% in November, following slower loan growth among non-small and medium enterprises (non-SMEs). Corporate bonds also slipped to 3.4% from 3.8% previously.

“Nonetheless, SME loan growth remained broadly sustained, with continued increase in growth of loans for investment-related purposes,” BNM noted.

For households, loan growth remained stable at 5.9% from 6% previously, with steady growth across various loan purposes, the central bank said in its monthly highlights report for December.

Meanwhile, the banking system's liquidity position continued to support financial intermediation. The system recorded healthy liquidity buffers, with an aggregate liquidity coverage ratio of 160.7% in December, compared to 147.9% in November.

The aggregate loan-to-fund ratio remained broadly stable at 83.5%, slightly down from 83.8% the previous month.

Overall gross impaired loans continued to decline, improving to 1.4% from 1.5%, while net impaired loans ratio remained stable at 0.9%.

Loan loss coverage ratio — including regulatory reserves — remained prudent at 129.1% of impaired loans compared to 128% in the previous month, said BNM.