PETALING JAYA: Analysts believe that RHB Bank
Bhd’s earnings outlook for the remaining quarters of this financial year (FY25) should remain sound despite a temporary blip in the first quarter.
Hong Leong Investment Bank Research (HLIB Research) said the lender will be supported by a non-interest income booster from fair value through other comprehensive income gains and upcoming bancassurance deals, resilient credit costs, along with net interest income growth on stable net interest margins and an enlarged loan base.
“RHB remains one of our high-conviction picks as we continue to find its risk-reward profile favourable, supported by an appealing 7% dividend yield and its inexpensive valuation as part of the Bursa Malaysia financial services index.
“Furthermore, we do not rule out the possibility of a higher dividend payout ratio. All in, we maintain our ‘buy’ rating with an unchanged target price of RM7.70, based on one times FY26 price-to-book multiple,” the research house said.
HLIB Research said it expects RHB’s loan growth momentum to pick up, though at a moderate pace.
It said RHB’s strategy prioritises defending its net interest margins by focusing on higher-yielding products in the middle market and commercial segments without compromising mortgages and hire purchase.
