KUALA LUMPUR: CIMB Equities Research remains bullish on Malaysian banks in 2010 even after their spectacular showing in 2009.
The research house said on Friday, Jan 15 the banks share price performance in 2010 will be supported by brisk earnings growth of 23% on the back of economic recovery.
"The expected earnings catalysts are a (1) 6.9% slide in loan loss provisioning, (2) 10.5% yoy rise in net interest income, and (3) 12.7% increase in non-interest income. For 2010, we are forecasting a pick-up in loan growth to 8-9% (vs. 6-7% for 2009) and gross NPL ratios of 3.6-3.8% (3.8% in 2009)," it said.
Sustained broad-market sentiment should attract further buying interest in banks, which collectively have a significant weighting of 36% in the FBM KLCI.
"We reiterate our OVERWEIGHT rating on banks in view of the potential re-rating catalysts of (1) strong earnings growth, (2) increase in investment banking income, (3) revamp by a few banks, and (4) strong growth potential for the overseas operations of the larger banks. AMMB remains our top pick," it said.
About Me
- Nuang
- Ibrahim bin Ramli@Nuang started his career with CIMB Wealth Advisors Berhad as Agency Manager in April, 2008.Previously he was an Internal Auditors and Accounts Executive with Perodua Sales Sdn Bhd since 17 August, 1994. His background:- 1.Certified of Achievement for Master Sales Leadership from Dr Lawrence Walter Ng of President of The Art Of Learning and International Of Learning Without Learning 2.Certified for eXtra Ordinary Performance of Lawrence Walter Award Certificate for One Million Ringgit Club 2007 3. Certified Life & General insurances 4. Conferred with Diploma in Business Studiess & Bachelor of Business Admin(Hons)Finance from UiTM, Terengganu Branch & Shah Alam respectively;
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