Banks expect one cut in OPR in 2H25

RHB Research said that in 1Q25, some banks reported key financial metrics that were trailing 2025 guidance.

PETALING JAYA: Despite the subdued first quarter (1Q) financial numbers and downside risks to the local banking sector’s outlook for the second half of the financial year (2H25), RHB Research has retained its “neutral” stance on the sector after banks retained their 2025 guidance and return on equity (ROE) targets.

The research house, in a sector report, stated that banks’ operating income in 2H25 faced challenges from US tariffs but was cushioned by realising trading profits and overlay reversals.