Public Bank First Take: Non-II drives 1Q26 miss; weakness could provide an entry point ahead of capital reforms

研报英文原文证据摘录

Public Bank First Take: Non-II drives 1Q26 miss; weakness could provide an entry point ahead of capital reforms

J P M O R G A N Asia Pacific Equity Research

14 May 2026

Public Bank Overweight

PUBM.KL, PBK MK

First Take: Non-II drives 1Q26 miss; weakness could Price (13 May 26):RM4.88

provide an entry point ahead of capital reforms Price Target (Jun-27):RM6.00

Our First Take: PBK reported 1Q26 net income of RM1.75bn, flat y/y, down 7%

q/q and 4% below JPMe. Earnings were slightly weaker than BBG consensus

expectations at 23% of FY26 estimates. The miss was driven by non-II, which

declined 5% q/q (+3% q/q), on weaker fee, unit trust and investment income. NII

was steady and in line with our expectations, with modest 1% q/q loan growth and

small NIM compression to 2.11% but 2bps higher vs JPMe. Asset quality was

broadly stable. The bank booked 5bps ann. credit costs, higher than the previous APAC Banks

ACfour quarters but within guidance (single-digit), as the NPL ratio was steady q/q at Harsh Wardhan Modi

0.51%. The CET1 ratio declined 20bps q/q to 13.7%. (65) 6882-2450

harsh.w.modi@jpmorgan.com

We expect slight near-term weakness on the back of these results, with J.P. Morgan Securities Singapore Private Limited/

J.P. Morgan Securities (Asia Pacific) Limited/ J.P.

commentary and outlook for non-II likely to be a key focus area in management’s Morgan Broking (Hong Kong) Limited

briefing. This could provide a better entry point for the stock, as we expect the Basel Daniel Andrew Tan, CFA

3.5 impact to become clearer over the next few months (1 July 2026 (63-2) 8554-2413

implementation), supporting upside to payout. The bank has also announced and danielandrew.o.tan@jpmorgan.com

received approval (link) for buyback of up to ~10% of its shares, which addresses J.P.