Malaysia Banks May Have Limited Near-Term Catalysts -- Market Talk

0329 GMT - Malaysia's banking sector is expected to remain range-bound in the absence of immediate near-term catalysts, Hong Leong IB analyst Raymond Ng says in a note. He says current valuations already reflect optimism over capital management, with the sector trading at 1.15X forward book value, one standard deviation above its five-year average. Prospects for additional shareholder returns remain largely limited to AMMB, CIMB and Public Bank, he says. A potential expansion of the KLCI could also create a temporary overhang, limiting scope for a sector re-rating, he adds. Potential expansion of the benchmark stock index KLCI to 50 constituents from 30 could also weigh on bank shares, as financial stocks have consistently dominated the index. Hong Leong maintains a neutral rating on Malaysian banking sector, pegging AMMB as 2H top pick. (yingxian.wong@wsj.com)

(END) Dow Jones Newswires

August 02, 2026 23:29 ET (03:29 GMT)