OREANDA-NEWS. March 25, 2011. In Feb, sector loans rose by 1.0% mom (vs 0.2% slide in Jan) on strong corporate ( plus 1.5% mom) and more streamlined retail lending (0.0% mom). Deposits wise, the sector witnessed a slowdown with total deposits rising by 0.7% (vs mom growth of 2.2% in Jan and 3.20% in Dec), mainly on the back of a deposit outflow in corporate segment (-2.9% mom), slightly offset by a growth in retail funds (-1.9% mom).

Millennium Capital deems the sector data is POSITIVE for banks. We consider the loan dynamics is solid given negative mom growth of -0.2% and -0.3% in Jan and Dec respectively. This may point to the long awaited trend reversal in lending in the 1H11. We expect the market to react positively to the news and see banking stocks advancing in the coming days.