KUALA LUMPUR (Feb 15): AMMB HOLDINGS BHD [] shares edged down at noon on Wednesday after CIMB Research said the banking group’s 9MFY3/12 results revealed a weak underlying trend for the lending business as year-on-year loan growth was only 6.2% in Dec 2011 and NIM shrank y-o-y.
At 11.57am, AMMB shed one sen to RM6.11 with 768,300 shares traded.
AMMB posted net profit of RM357.18m for the third quarter ended Dec 31, 2011, up 9.8% from the RM325.31 million a year ago underpinned by profit growth across most divisions.
Its revenue increased 7.2% to RM1.955 billion from RM1.824 billion. Earnings per share were 11.95 sen compared with 10.83 sen.
For the nine-months ended Dec 31, 2011, its earnings increased by 13.8% to RM1.168 billion from RM1.026 billion in the previous corresponding period. Its revenue registered a 14% increase to RM6.047 billion from RM5.302 billion.
CIMB Research in a note Feb 15 said it deemed the results slightly disappointing as 9M net profit was 72% of its full-year forecast and 77% of consensus.
The research house said its FY12 net profit and target price (10% discount to DDM value) are trimmed as it lowered loan growth by 1 percentage point and lending yield by 5 basis points.
“We retain our Neutral call as the challenging lending environment will dilute the impact of the revamp,” it said.
“Despite the benefits of its continuing revamp and strong treasury income growth, we do not advise investors to accumulate the stock for a host of reasons – below-industry loan growth, y-o-y drop in margin and increased competition for the investment banking business. We prefer Maybank,” it said.
At 11.57am, AMMB shed one sen to RM6.11 with 768,300 shares traded.
AMMB posted net profit of RM357.18m for the third quarter ended Dec 31, 2011, up 9.8% from the RM325.31 million a year ago underpinned by profit growth across most divisions.
Its revenue increased 7.2% to RM1.955 billion from RM1.824 billion. Earnings per share were 11.95 sen compared with 10.83 sen.
For the nine-months ended Dec 31, 2011, its earnings increased by 13.8% to RM1.168 billion from RM1.026 billion in the previous corresponding period. Its revenue registered a 14% increase to RM6.047 billion from RM5.302 billion.
CIMB Research in a note Feb 15 said it deemed the results slightly disappointing as 9M net profit was 72% of its full-year forecast and 77% of consensus.
The research house said its FY12 net profit and target price (10% discount to DDM value) are trimmed as it lowered loan growth by 1 percentage point and lending yield by 5 basis points.
“We retain our Neutral call as the challenging lending environment will dilute the impact of the revamp,” it said.
“Despite the benefits of its continuing revamp and strong treasury income growth, we do not advise investors to accumulate the stock for a host of reasons – below-industry loan growth, y-o-y drop in margin and increased competition for the investment banking business. We prefer Maybank,” it said.
