However, the report noted that total loan applications increased 5.7 percent since May 2009 supported by the rebound in business.
The Malaysian government expected the private sector financing through the banking system and capital market to grow as economic recovery gathered momentum, said the report.
Under BNM’s promotion, micro financing provided by six commercial banks and three development financial institutions grew substantially.
The report said total loans outstanding increased 44.8 percent to 587.5 million ringgit (167.86 U.S. dollars) by end of August 2009, benefiting some 54,900 clients.
While inflation showed negative growth in the last few months, it was anticipated to rise moderately in line with the increase in global commodity prices.