27/03/2024 03:42 PM

KUALA LUMPUR, March 27 (Bernama) -- AMMB Holdings Bhd (AmBank) is likely to post notable quarter-on-quarter earnings growth next quarter, backed mainly by lower net credit costs, said Hong Leong Investment Bank (HLIB).

In a note today, HLIB said that even after the recent price recovery from the overhang of Australia and New Zealand Banking Group Ltd (ANZ) share disposal, it still finds AmBank's risk-reward profile remains tilted to the upside.

"Furthermore, provisions made so far for impaired loans are sufficient, in our opinion.

“Besides, the potential adoption of foundation internal rating-based in financial year 2025 could create headroom for a larger dividend payout in the future," it said.

As such, HLIB retains its 'buy' call on AmBank, raising its target price to RM4.60 from RM4.20 previously.

Earlier this month, ANZ agreed to sell 16.5 per cent of the issued capital in AmBank via a block trade at a price of RM3.85 per share.

ANZ said the sale would reduce its shareholding in AmBank from 21.7 per cent to 5.2 per cent, in line with ANZ’s strategy of simplifying the bank.

At 2.37 pm, AmBank shares added 1.0 sen to RM4.16 with 1.78 million shares traded.


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