Key takeaways
CIMB Securities warns Malaysian banks may face third-quarter earnings pressure from global bond volatility but maintains an Overweight rating due to strong fundamentals. The firm recommends Public Bank, RHB Bank, and Hong Leong Bank as top picks.
- CIMB Securities maintains an Overweight rating on the Malaysian banking sector despite near-term market volatility.
- Public Bank, RHB Bank, and Hong Leong Bank are named top picks with Buy recommendations.
- Public Bank's RM3.5 billion capital return plan is expected to sustain dividend yields above six per cent.
Summarised automatically by AI from the original article by New Straits Times. AI can make mistakes, so check the original for details.
KUALA LUMPUR: Malaysian banks could face pressure on their third-quarter earnings from global bond market volatility and potential mark-to-market losses, although strong fundamentals should help cushion the impact.
CIMB Securities Sdn Bhd said a global bond sell-off had created a more challenging operating environment for banks in the third quarter of this year.
Despite this, the research firm maintained its "Overweight" rating on the Malaysian banking sector, citing banks' ability to weather the uncertainty.
"Defensive earnings, resilient asset quality, and ample capital, liquidity, and loan loss buffers should help cushion the impact of near-term market volatility," it said in a note.
