“We should not view the MTR in isolation as we cannot afford to ‘rebuild’ a better Malaysia with a blunt tool,” says Bank Islam chief economist Firdaos Rosli.
PETALING JAYA: Despite a challenging operating environment, BIMB Holdings Bhd
is optimistic of achieving its financing growth target of 7% to 8% in financial year 2023 (FY23) against 11% in the previous year.
Maybank Investment Bank (Maybank IB) Research said to date, the bank’s financing growth has been seasonally subdued.
“The personal financing (PF) portfolio continues to grow where non-packaged PF is concerned. The bank targets primarily professionals to ensure asset quality. Having put through investments in FY22, SME financing is expected to pick-up pace in FY23,” it said in a note to clients.
However, it added that the bank’s targets for this year appear to be stretched considering the challenging operating environment.
“With price competition, BIMB’s FY23 net interest margin (NIM) target of 2.2% is likely under pressure, in our view, while operating cost growth is likely to be faster at 7% to 9% versus a 7% target previously. Credit cost, meanwhile, is likely to pick up to 40 basis points (bps) to 50 bps from a previous guidance of about 33 bps to 35 bps,” the research house added.
On the back of the stiff deposit competition, Maybank IB Research has lowered its NIM assumptions, while raising its credit cost assumptions on expectations of slower economic growth.
“Our FY23/24 estimated earnings are cut by 12% respectively and our target price is lowered to RM2.20 on a lower FY23 estimated price-to-book value target of 0.7 times (return on equity: 7.2%),” the research house added.
