Rasheed said the central bank is monitoring the elevated household debt level, even as loans are being extended prudently and repaid on time.
“From a stability perspective, these are good quality loans, and the total shareholder return has also improved,” Bernama reported him as saying after announcing Malaysia’s second quarter economic performance today.
He said banks have been prudent in their loan approvals and have supported households through sound financing practices.
“The latest household impairment ratio stands at a healthy 1.1%, which reflects the resilience of household borrowers,” he said.
In a recent Dewan Rakyat sitting, deputy finance minister Lim Hui Ying stated that Malaysia’s household debt reached RM1.65 trillion as of the end of March. While this level remains elevated, she said it is offset by robust household assets.
She said the household sector remains resilient, backed by financial assets amounting to RM3.45 trillion as at end-March, which is 2.1 times higher than the total debt.
Rasheed also said Malaysia’s current account balance is expected to remain in surplus of between 1.5% and 2.5% of GDP in 2025.
This follows a smaller current account surplus of RM300 million, or 1% of GDP, recorded in Q2 2025, mainly due to cyclical factors such as planned maintenance that disrupted commodity production.
He said this in turn led to a RM5.1 billion quarter-on-quarter drop in mining-related exports and a sharp rise in capital imports following the realisation of data centre investments.
“Overall, the current account balance in the first half of this year remains healthy at 1.7% of GDP compared with 0.9% in 1H 2024,” he said.
He reiterated that the increase in capital imports would strengthen Malaysia’s exports in the long-term as the operationalisation of data centre investments is expected to contribute to services exports.
“We have seen some of this coming already. In addition, higher travel receipts driven by the continued rise in inbound tourism are expected to contribute to the further narrowing of the services account deficit,” he said.
Rasheed said the encouraging development is expected to continue into 2026, following government initiatives such as enhancing flight connectivity and the Visit Malaysia 2026 campaign.