Higher NIM positive for smaller banks

HLIB Research has maintained a “neutral” call on the banking sector.

PETALING JAYA: Smaller and mid-sized banks are expected to benefit more from an upside bias to net interest margin (NIM) versus their larger counterparts as they are more susceptible to fixed-deposit (FD) competition.

NIM is what banks earn from customers from interest on their loans versus what customers get from FD interest.