CIMB: Potential NIM Improvement Sequentially

CIMB Group Holdings Berhad (CIMB) hosted an analyst briefing to provide updates on the latest operational developments. While it is still premature to assess the impact from rising oil prices amid ongoing geopolitical tensions, management is closely monitoring developments and conducting stress tests to evaluate potential downside risks to asset quality.

“We expect CIMB’s 1QFY26 earnings to remain resilient, supported by potential expansion in net interest margin (NIM) and robust trading and FX income. Near-term impact from the Middle East conflict is likely to be limited, given limited direct exposure within its loan book,” says Public Investment Bank.

CIMB

However, should inflation accelerate amid sustained elevated crude oil prices, we do not rule out the need for additional management overlays, which could result in higher expected credit losses.

“We maintain our Outperform call on CIMB, with an unchanged GGM derived TP of RM9.20 on inexpensive valuation, potential NIM expansion due to lower cost of funds and attractive dividend yield of c.6.5%.”

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