MBSB Calls Malaysian Banks’ Dividend Yields “Extremely Attractive”, Sees Buying Opportunity
Octopaul AI ·
MBSB Investment Bank analyst Samuel Woo described Malaysian banks’ dividend yields as “extremely attractive”, viewing yields of approximately 6% among mid-to-large-sized banks as an opportunity to accumulate. In his October 16 banking report, he maintained his “Positive” sector stance, arguing that falling bond yields could help banks recover investment losses and ease concerns over potential dividend disappointments.
Samuel Woo is currently ranked No.3 among 9 MBSB Investment Bank analysts on StockTipRatings, based on data since 2023. He holds a 75% expert rating, with a 12% average return and a 79% success rate across stocks he covered over the one-year period following his calls.
Samuel noted that Malaysia’s 10-year government bond yield had retreated from nearly 4.2% to around 3.8%, potentially allowing banks to recoup some investment losses in 4Q26. He believes concerns over weaker third-quarter results have likely been priced in, supporting opportunities to accumulate.
Beyond investment-income recovery, Samuel sees business-loan demand supported by the construction cycle and data-centre projects. Wealth-management activity is also supporting fee income, while technology-driven efficiencies are helping contain operating costs. Higher dividend payouts and special dividends could provide further support to shareholder returns.
However, persistent deposit competition could keep funding costs elevated, while renewed increases in bond yields could undermine the recovery.
His top picks are Hong Leong Bank and Public Bank, both rated “Buy”, with target prices of RM29.80 and RM5.53, respectively. Samuel favours Hong Leong Bank’s strong asset quality, provisioning buffers and capacity to increase dividends, while Public Bank offers predictable quarterly earnings, solid asset quality and dividend support from capital-management initiatives.
As of October 16, Bursa Malaysia’s Financial Services Index fell 0.4% to 18,751.82 points.
Disclaimer: All content is AI-aggregated from public sources for informational and educational purposes only. StockTipRatings.com does not constitute investment advice. Past performance and historical statistics are no guarantee of future returns.