Bank loans in Singapore have grown 7.6 percent in June, clocking in its fastest pace in over two years with both business and consumer loans expanding.
This followed last month's growth of 6.8 percent and brings the first six months' growth to 6.0 percent.
According to the figures released by the Monetary Authority of Singapore, total bank loans reached S$635.52 billion in June, up from last year's S$590.41 billion.
OCBC Treasury Research noted that business loans accelerated by 10.5 percent, the highest growth seen since October 2014.
Total business loans rose to S$381.13 billion, led by the 31 percent expansion in lending to financial firms to S$89.46 billion. This is the 10th consecutive month of double-digit growth for the sector and the highest since March 2012.
The loans to business services firms during the said month also rose, up 27.9 percent to S$8.6 billion. Meanwhile, general commerce loans reflected a 20.9 percent growth to S$68.27 billion.
On the other hand, loans to manufacturing continued to drag growth for business lending. For the said month, manufacturing loans were down by 1.9 percent.
Meanwhile, consumer loans also picked up the pace to 3.7 percent, reflecting a total amount of S$254.39 billion. These loans are heavily buttressed by housing loans, which expanded by 4 percent in the said month to S$194.82 billion.
Car loans also accelerated, up 3.2 percent to S$8.04 billion, the highest since November 2012.
OCBC Treasury Research noted that bank loans growth momentum should sustain in the next six months to average 7.0% for the whole year. This is given the positive business sentiments during the first half of the year.
"Moreover, while regional trade and economic activities may moderate in 2H after a stellar 1H, regional manufacturing and services PMIs (purchasing managers' indices) do not suggest a sharp drop-off at this juncture," the research firm said in a statement.
Additionally, the firm noted that the declining layoffs in Singapore could provide some support to consumer appetite for big-ticket items.