Broker Name: CGS International
Date of Report: December 8, 2025
Excerpt from CGS International report.
Report Summary:
- Malaysian banking sector loan growth moderated slightly to 5.4% year-on-year in October 2025, with business and household loan growth remaining stable; deposit growth has improved, narrowing the gap with loan growth.
- Gross impaired loans (GIL) decreased month-on-month, reflecting improved asset quality, and the GIL ratio declined to 1.39%.
- CGS International maintains an Overweight stance on Malaysian banks, expecting potential write-backs, improved net interest margins, and higher dividend payouts, with top picks being Hong Leong Bank, RHB Bank, and CIMB Group Holdings.
- Loan applications and approvals saw a year-on-year drop, especially in working capital loans, while residential mortgage and auto loan approvals showed resilience.
- Interest rates have remained relatively stable, and deposit competition has eased somewhat; potential downside risks include weaker economic growth and increased credit risk.
- On ESG, Malaysian banks are assessed as having low direct ESG risks, with Maybank highlighted for leading in ESG initiatives and disclosures; banks are increasingly focusing on green financing and sustainable finance targets.
Above is an excerpt from a report by CGS International. Clients of CGS International can be the first to access the full report from the CGS International website: https://www.cgs-cimb.com
