Credit applications increased across all lending activities during the final quarter of 2016, bucking the seasonal credit cycle trend that typically sees credit demand fall toward the end of the year, and signalling what some analysts describe as a healthier outlook for the financial sector.

According to data released yesterday by the Credit Bureau Cambodia (CBC) for the fourth quarter of 2016, overall credit applications – which include personal finance, credit cards and mortgages – increased by 13 percent, compared to an 11 percent decrease during the same period in 2015. This is the second quarter in a row that credit applications were in positive territory, with the third quarter reporting an overall 24 percent growth across all lending products.

The fourth quarter growth was driven an increase of credit card applications, which grew by 17 percent, followed by mortgage applications at 16 percent, and personal finance at 13 percent.

“When seen from a yearly perspective, quarters 2 and 4 usually observe a decrease in credit applications,” the report said. “This year, applications kept increasing with an equal growth between all three types of credit applications.”

The report added that the number of credit accounts also increased in every quarter of 2016, surging 11.4 percent in the first quarter and tapering off to a more stable 1.8 percent by the final quarter.

The total number of consumer loans was recorded at 679,000, comprised mainly of personal finance, with total outstanding loan balances by financial institutions standing at $3.16 billion by the end of the year.

Bun Mony, board chairman of newly formed microlender Vithey Microfinance Plc, said that while credit application cycles generally correlate to seasonal agrarian demand and holiday clusters, the overall increase in credit applications was indicative of a more stable lending environment.

“I feel that compared to 2015, last year’s numbers are a healthy indicator that lending is starting to become more mature,” he said. “In 2015 and into 2016 the economy was not in good shape and this could show that agriculture was on a better footing.”

Oeur Sothearoath, CBC’s interim chief executive, said that while the credit cycles have largely followed suit with quarter-over-quarter swings that fluctuate between negative and positive demand, overall credit applications grew by 29 percent in number and 32 percent in value last year.

“A slight slowdown was expected for the last quarter of the year as there was a general slowdown in the industry and also less activities in the market as well,” he said. “However, the general trend is that credit demand continues to increase.”

Correction: The total number of consumer loans reached 679,000 by the end of last year and was misinterpreted as being the total monetary value of consumer loans. The Post apologizes for any confusion.