text: “Problem loan formation will increase over the next 12 to 18 months amid subdued economic growth, as corporates face lower business volumes and margin compression while personal borrowers face limited wage growth. We expect problem loans to increase to between 4.8 per cent and 5.3 per cent of gross loans over the outlook horizon. The small and mid-sized corporates segment, along with individuals, will drive the increase in delinquencies,” said the report.
  Household loan performance will continue to weaken as limited wage growth combined with a high cost of living constrain borrowers’ repayment capacity, the credit ratings agency said.