CIMB Expected To Deliver "Decent" Performance In Q2
The research firm has maintained a 'Hold' call on CIMB with an unchanged target price of MYR7.60, pending the official release of the group's results. CIMB Group is scheduled to announce its 2Q25 results on August 29, following the release of its Indonesian subsidiary, CIMB Niaga, on July 30.
Maybank Research highlights several positive factors contributing to the bank's expected performance for the quarter ended June 30:
Net interest margins (NIMs) are likely to have remained stable quarter-on-quarter, with positive traction in Malaysia and Singapore offsetting some compression in its Thai and Indonesian operations.
The report anticipates a sequential increase in non-interest income, driven by sustained trading and foreign exchange activities.
Asset quality is expected to remain stable, with credit costs likely to be benign. The report notes that CIMB's credit cost guidance of 25-35 basis points for the full year 2025 remains intact, suggesting a potential positive surprise as Maybank's own forecast for the year is a slightly higher 36 basis points.
However, the report points to one area where results may be weaker than expected: loan growth. According to Maybank Research, the group has been cautious in lending to the corporate and commercial sectors due to competitive yields. This has led the research house to forecast a loan growth of 4.5% for the full year, below CIMB Group's own target of 5-7%.
Despite the mixed outlook, Maybank Research is keeping its earnings forecasts unchanged, believing the positive elements of stable margins and strong non-interest income will support its existing assumptions for the group. The report concludes that while the group is positioned for stability in the near term, its 'Hold' rating reflects a cautious but fair valuation at this juncture. Related
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