KUALA LUMPUR: CIMB Equities Research said MALAYAN BANKING BHD []’s 25 basis points hike in its base lending rate (BLR) was broadly within its and market expectations.
However, it said on Tuesday, March 9 the the 23bp average rise in fixed deposit (FD) rates was higher than its expected 12-15bp increase.
“Due to the higher-than-expected increase in FD rates, every 25bp hike will only enhance Maybank's net profit by 0.8% compared to 4.4% estimated previously based on a lower 12.5bp rise in FD rates,” it said.
Factoring in a hike of 50bp in BLR and 46bp in FD rates, CIMB Research raised its FY10-12 net earnings forecasts by 0.7-2.2%, lifting the target price from RM8.10 to RM8.35 (pegged to unchanged 5% premium to DDM value).
Without any significant uplift from the rate hikes, the stock remains a NEUTRAL.
Earnings-wise, it projects strong core EPS growth of 15-46% in FY10-12, but it believes that the positive earnings trends have largely been priced in, reflected by above-average CY11 P/E of 11.8x.
“We prefer Public Bank for exposure to big-cap Malaysian banks,” 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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