Positive emerging trends

TA Research has trimmed its earnings estimates for the banking sector by 3.8% for this year and 4.6% for 2024 after incorporating lower loan growth and NIM assumptions for the eight banks under its coverage.

PETALING JAYA: The operating environment may be challenging for the banking sector in the country this year, but not all is lost.

Positive factors such as healthy investment income, a benign asset quality outlook and ample capital as well as liquidity reserves are expected to cushion the dampening effects on earnings from slower loan growth, net interest margin (NIM) compression, lacklustre fee income to rising overhead costs.