KUALA LUMPUR (Sept 12): According to UOB Kay Hian, Malaysian banking-sector earnings are expected to contract this year, given earnings disappointment in 2Q rose to 44% from 22% in 1Q.
The brokerage adds that there is no visible earnings growth catalysts in the sector. It maintained its market weight on Malaysia’s banking industry.
However, it downgrades AMMB to a hold rating from buy, citing its recent share price rally but retains buy ratings on CIMB and BIMB recognising attractive valuations and above-industry earnings growth. UOB Kay Hian expects Public Bank to be at risk of falling given its relatively high foreign shareholding and expensive valuations.