KUALA LUMPUR (Oct 9): Alliance Bank's outlook for the next nine months isn't particularly rosy, Hong Leong Investment Bank says, anticipating weaker loan growth for the year ending March 31 and a lower non-interest-income run rate.
However, Hong Leong expects the Malaysian lender's net-interest margin will recover from 3Q FY 2020 onward, with bad-loan accounts having been fully provided for by then.
Hong Leong cuts its FY 2020-FY 2022 net profit forecasts for Alliance by 4% to 6%, but thinks most of the negatives are already priced in and therefore maintains the stock at buy, though with a lowered target price of RM3.40 from RM3.70 previously.