What is the current impaired household loan ratio in Malaysia?

Question

Accepted Answer

Malaysia's Impaired Household Loan Ratio Remains Low and Stable

Malaysia's impaired household loan ratio stood at a stable and low 1 per cent at the end of December 2025. This figure represents a slight improvement from the 1.1 per cent recorded in June 2025, indicating continued borrower capacity to meet financial obligations. Overall household debt, while increasing to RM1.73 trillion by the end of the first quarter, has eased relative to the nation's economic output.
Impaired Loan Ratio Stability

The government has indicated that the impaired household loan ratio has maintained a low level, specifically at 1 per cent as of December 2025. This metric is a key indicator of the financial health of households concerning their loan repayments. The slight decrease from 1.1 per cent in the preceding June period suggests a robust ability among Malaysian borrowers to service their debts.
Debt Burden Relative to Economy

While the total value of household debt reached RM1.73 trillion by the end of March, its proportion relative to the Gross Domestic Product (GDP) saw a marginal reduction. The household debt-to-GDP ratio stood at 84.4 per cent at the close of the first quarter, a slight decrease from 84.7 per cent three months prior. This indicates that the growth in debt has been broadly in sync with the expansion of the economy.
Debt Servicing Capacity

Further reinforcing the stability of household finances, the median debt service ratio for outstanding household loans was reported at 33 per cent. Additionally, the median debt-to-income ratio remained steady at 1.3 times. These figures suggest that the increase in debt has been supported by rising incomes, rather than an excessive reliance on borrowing, and that households generally possess sufficient capacity to manage their debt obligations.

Reading history

Hide →

This history is cleared when the page is closed.

What is the current impaired household loan ratio in Malaysia?

Loading

Was this article helpful?

Helpful

Not helpful

Report an issue

1

0

0

Share with friends