We expect to see higher net profit after rates go up in January for Malaysian banks. Apparently it causes an adverse effect followed by loan growth contraction. CIMB has the data to look at the industry in the report below.
Take a look at the whole summary of bank’s report card for 2nd quarter of 2017.
We think that banks had rallied and recovered the losses trading fair to what it is now but we still think that you should hold if you have already seen capital gains holding from last year plus dividend payout that were made.
From now on, the movement is likely broad market related and we do not think that the major banking blue chip would outperform the KLCI. But we are still holding it rather than returning to cash as most stock seem fairly valued too.