Citigroup Sell for Pbbank -fv at 5.77 - SCARY MAN

0217 GMT [Dow Jones] STOCK CALL: Citigroup keeps Public Bank (1295.KU) at Sell with MYR5.77 target price following lender's 18% fall in 1Q09 net profit to MYR589 million. Says Islamic banking income, treasury/FX business weak, NIM declined 10bps on-year due to lower interest rate environment, continued competition for consumer loans. Also, warns both mortgage (now at BLR minus 2.3-2.4%), auto hire purchase (now 4.0%) rates "remain under downward pressure." Adds, bank retains 15% loan growth target for this year but "management views it may not be achieved and will depend on how long the economic downturn will last." Shares last down 1.2% at MYR8.35. (PVA)
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0232 GMT [Dow Jones] STOCK CALL: UOB KayHian maintains Public Bank (1295.KU) at Hold with fair price of MYR6.88. Notes 1Q09 net profit down 17.9% on-year but says decline due mainly to one-off goodwill payment of MYR200 million from ING; "excluding this, net profit would have been flat." Adds 4% loan growth "faster than expected" but this offset by impact of decline in interest rates; "given that Public Bank's loans are mainly at a floating rate (64%), rate cuts will see faster repricing downwards vs deposit rates." Broker expects another 50bp cut in Overnight Policy Rate (OPR) in 2Q09. Says stock's valuation higher than peers' because it factored in lender's good asset quality, higher ROE; shares last down 1.8% at MYR8.30. (PVA)
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1 comments:

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TQ
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