Hong Leong Sees CIMB's Q3 Earnings Under Margin Pressure, Cuts Target
Hong Leong IB analyst Raymond Ng expects CIMB's third-quarter earnings to soften on narrower margins and a weaker income base, and has cut his target price.
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what happened
Analyst Raymond Ng of Hong Leong IB expects CIMB's third-quarter earnings to moderate, according to Market Talk. He points to a tougher comparison: a one-off gain of about 100 million ringgit booked in the second quarter will not repeat, and trading income may fade from a strong first half.
Ng also flags pressure on net interest margins. Indonesia is seen as the main downside risk, since tighter liquidity may squeeze lending spreads, and weaker recoveries on older loans could lift credit costs. Solid corporate lending growth in Malaysia should offer some cushion.
A possible privatization of the Indonesian unit could give the group more strategic room, but it might also require extra capital. Hong Leong has lowered its target price to 7.70 ringgit from 8.10 ringgit and kept a hold rating. Shares were up 0.1% at 7.16 ringgit.
why it matters
CIMB is one of Malaysia's larger banks, so a softer margin outlook matters for the local banking sector and the broader stock market. Investors will watch asset quality in Indonesia and the margin trend ahead of the reporting season. The privatization idea remains a possibility, with no confirmed terms.
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- CIMB's 3Q Earnings Could Face Margin Pressure — Market Talk, 21 October 2026 at 02:27 UTC
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