FW: AmBank Research - Banking Sector : Asset quality of household loans holding up OVERWEIGHT, 2 Oct 2017

 

 

SECTOR FOCUS OF THE DAY       

Banking Sector : Asset quality of household loans holding up                       OVERWEIGHT

 

Industry loan growth accelerated to 5.8% YoY in Aug 2017 underpinned by a pickup in pace of non-household loans while growth in household loans continued to be stable. Industry loan growth climbed to 5.8% YoY in Aug 2017, after a drop in the previous month to 5.6% YoY.

 

The improvement was contributed by a stronger growth of non-household loans while the household loan growth remained stable. By loan purpose, this was driven by an improvement in pace of working capital loans, personal loans and loans for purchase of securities. Overall households loan continued to be stable with a modest growth of 5.0% YoY. By sector, the stronger industry loan growth was driven by higher growth of loans in the primary agriculture, construction and utilities segments compared to the preceding month.

 

The level of loan applications continued to climb in Aug 2017 attributed to higher loan demand by households. Industry deposits picked up pace with a stronger momentum in business enterprises and individual deposits while CASA ratio remained steady at 26.8%. Maintain OVERWEIGHT with BUYs on RHB Bank and Public Bank. We maintain OVERWEIGHT with BUYs on RHB Bank (FV: RM6.00/share) and Public Bank (FV: RM22.20/share).

 

Others :

Dialog Group : Boost from 80% stake in Tanjung Langsat terminals            BUY

IJM Plantations : Slower production in 2H2017                                                    HOLD

Star Media Group : Selldown overdone                                                                 HOLD

 

 

QUICK TAKE

Plantation Sector : News flow for week 25 – 29 September                          NEUTRAL

 

 

STOCKS ON RADAR

Cypark Resources, Magni-Tech Ind., Datasonic, Heitech Padu

 

 

ECONOMIC HIGHLIGHT

Malaysia : Cost of doing business fairly contained 

 

 

NEWS HIGHLIGHTS

Property Sector : Empire City Damansara 2 land up for sale

Thong Guan : Plans RM650mil 3-fold expansion

United Malacca : Confident of finalising Sulawesi land buy

HSS Engineers: In deal to acquire water specialist

 

 

 

DISCLAIMER:

The information and opinions in this report were prepared by AmInvestment Bank Bhd. The investments discussed or recommended in this report may not be suitable for all investors. This report has been prepared for information purposes only and is not an offer to sell or a solicitation to buy any securities. The directors and employees of AmInvestment Bank Bhd. Bhd may from time to time have a position in or with the securities mentioned herein. Members of the AmBank Group Bhd and their affiliates may provide services to any company and affiliates of such companies whose securities are mentioned herein. The information herein was obtained or derived from sources that we believe are reliable, but while all reasonable care has been taken to ensure that stated facts are accurate and opinions fair and reasonable, we do not represent that it is accurate or complete and it should not be relied upon as such. No liability can be accepted for any loss that may arise from the use of this report. All opinions and estimates included in this report constitute our judgment as of this date and are subject to change without notice.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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