ASSETS of credit institutions grew by 7.2 per cent last year but was still lower than the previous year's record, the Reserve Bank of Fiji said in its 2011 annual report.
According to the report, credit institutions' assets were worth 14.7 per cent more than the $427.6 million it was set at last year.
The increase last year was owed to the increase in loans and advances of $19.2 million and deposits totalling $10.6 million with the banks.
Gross loans, advances and leases increased by 15.5 per cent to $357.4 million, while lending to the private sector business entities increased by $22.6 million, the bank said.
Investments on the other hand, were constant at $27.2 million but performance indicators suggested that credit institutions asset quality deteriorated last year, the bank said.
The report said credit institutions injected $5 million capital into their business.
But unlike the trend of the past three years, credit institutions' profits before tax dropped to $17.9 million, the report said.
"Escalating bad debt and provision expenses and operating outlays, more than offset positive streams," the report said.
And while non-performing loans rose, it remained at manageable levels, the bank said.
The report noted deterioration in the efficiency ratio of credit institutions to 36.3 per cent prompted by an increase in operating expenses over operating income.
The report said there was declining profitability in the credit institutions sector.