Malaysia banks

Research evidence excerpt

Malaysia banks

Global Markets Research

17 July 2026Malaysia banks

EQUITY: BANKS

What is driving the recent rally? Research Analysts

Malaysia Banks

Rotation from global tech might be helping inflows; we reiterate Buy on Tushar Mohata, CFA - NSM

our preferred picks: RHBBANK, AMM and CIMB tushar.mohata@nomura.com

+60(3)20276895

Executive summary Research Associates

• We think that the most credible explanation for the recent surprise rally in banks is a Malaysia Banks

rotation away from crowded AI beneficiaries and towards previously overlooked, high- Alpa Aggarwal, CFA - NSFSPL

yielding ASEAN banks. This could provide further near-term support if global flows

continue to broaden.

• Other potential reasons, such as 1H26 dividend positioning, stronger GDP data and

expectations of a more hawkish BNM provide less compelling fundamental

justification, in our view.

• We remain selectively positive rather than bullish across the board on the sector. We

think investors should use the improved sentiment to focus on banks with identifiable

ROE, capital-return or restructuring catalysts. We have Buy ratings on RHBBANK,

CIMB and AMM.

Possible reasons for the recent uptick

The recent rally in Malaysia’s banks (KLFIN up 5% since end-June) has taken both

investors and us by surprise. It comes despite the ongoing election season, which we

believe could raise policy-continuity risks, and ahead of an August results season where

we see limited scope for positive surprises. If anything, as we noted in our 1Q26wrap,

earnings estimates and guidance could face further downward revisions at selected

banks, in our view.

We think foreign buying is a key driver of the rally. Pinpointing the precise catalyst behind

short-term share-price movements is inherently difficult, but we see four possible