First Read: Affin Bank "Earnings missed; strong PPOP offset by higher..."

研报英文原文证据摘录

First Read: Affin Bank "Earnings missed; strong PPOP offset by higher..."

Global Research

18 May 2026ab

First Read

EquitiesAffin Bank

Earnings missed; strong PPOP offset by higher Malaysia

credit costs Banks, Ex-S&L

12-month rating Neutral

12m price target RM2.85

Weaker asset quality, impacted by macro headwinds

Q126 net profit was 12% below UBSe as higher credit costs more than offset strong

PPOP growth. Results were also a miss compared to consensus with Q126 net profit Price (15 May 2026) RM2.45

accounting for 23% of FY26F forecast. Asset quality weakened in Q1. NPL ratio RIC: AFIN.KL BBG: ABANK MK

increased 11bps q/q to 1.75% driven by higher corporate and SME NPLs – mainly

Trading data and key metrics

coming from the manufacturing and trading sectors impacted by weaker macro/higher

oil prices. While NPL ratio was stable for the consumer segment, stage 2 loans increased 52-wk range RM2.78-2.22

c40bps q/q to 5.7%. Mgmt is cautious on the asset quality outlook given the macro Market cap. RM6.21b/US$1.57b

uncertainties and has tightened credit underwriting to mitigate further asset quality Shares o/s 2,534m (ORD)

deterioration. Mgmt's base case is for the Middle East conflict to be resolved around Free float 23%

mid-year; absent this, there is downside risk to the credit cost guidance for the year. Avg. daily volume ('000) 1,646

Credit costs were 34bps, materially above UBSe (15bps) and the 13bps guidance for this Avg. daily value (m) RM4.2

year. NPL coverage declined slightly to 70%, and is at the lower end of the 70-80% Common s/h equity (12/26E) RM12.6b

target for this year. P/BV (12/26E) 0.5x

Tier 1 ratio 14%

Strong PPOP growth; good momentum in NII and fees

EPS (UBS, diluted) (RM)

Notwithstanding the weakness in asset quality, PPOP performance was strong, up 48%