HLIB Research 17 Nov 2011 (AMMB)

Stock Name: AMMB
Company Name: AMMB HOLDINGS BHD

Research House: HLG

Price Call: BUY

Target Price: 6.02

AMMB (HOLD)

Lower FY12 KPIs

''  2QFY12 results in line with HLIB and consensus asmanagement guiding for lower 2H.

''  Interim dividend of 6.6 sen (+10% yoy).

''  Results typified by absence of extra AFS profit, NIM at expense ofloans, preemptive provision for one corporate loan and swings in MTM of HFTsecurities and derivatives.   

''  FY12 KPIs cut to 13.6-14% ROE and 10-12% profit growthvs. 14-16%.  HLIB's forecast in line and at lower ranges.

''  Loans and deposits contraction due to addressing NIMerosion and focus on profitable growth. However, CASA grew strongly at 5.3% qoqand 20.5% yoy.

''  Credit cost guidance of 50-55bps lower than HLIB's60bps.

''  Asset quality improved despite the preemptive classification andprovisioning of one corporate loan.

''  Capital ratios remained strong, BASEL III core equityratio improved to 8.3% from 7.6%, no change to dividend policy.

''  Maintain HOLD with unchanged target price of RM6.02.