Hong Leong and AmBank maintain strong growth prospects

KUALA LUMPUR, Aug 3, 2026 — Despite sector headwinds, analysts believe fears over Malaysian banks may be overstated, with HL Bank and ABMB maintaining strong growth prospects and attractive dividend yields.

HL Bank’s profitability in CY26 may soften, but asset growth and dividend outlook remain intact. Analysts highlight the bank as a core beneficiary of emerging market inflows, citing robust loan growth, superior asset quality, and high capitalisation levels. Fee income from wealth management, bancassurance, and debt capital markets is expected to drive topline growth, though non-fee income may normalize after strong CY25 results.

Hong Leong

Loan growth is ramping up, particularly in business segments, though tighter liquidity has elevated deposit competition and FD rates. Net interest margin (NIM) compression is expected before stabilising in the second half of CY26. Rising cost pressures from tech investments and expansion remain a challenge, but asset quality issues are minimal.

ABMB also retains a positive outlook, with extremely high loan growth and market share capture continuing. Lower cost pressures are expected as earlier expenses under ACCELER8 have been absorbed. Fee income, particularly from wealth management, is ramping up. Analysts maintain a “BUY” call on ABMB with a target price of RM5.92, compared to RM4.76 as of July 31, 2026.

Overall, both banks are positioned defensively, with strong dividend yields and resilient asset quality, making them attractive picks despite sector uncertainties.

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