Hong Leong Bank / Quek Leng Chan

[winston]

vested

Hong Leong Bank (HLBK MK)
Share Price: MYR15.18
Target Price: MYR17.40
Recommendation: Buy

1HFY20 results above expectations

HL Bank continues to be a very stable and well-managed retail bank with superior fundamentals relative to many of its peers.

These include ROEs of above 10%, which are sustainable in the medium term, in our view.

With the decline in its share price, we upgrade the stock to BUY, but with a marginally lower TP of MYR17.40 (-50sen, CY20 PBV target of 1.3x, ROE: 10.4%).

Source: Maybank

https://factsetpdf.maybank-ke.com/PDF/1 ... 21857d.pdf

[winston]

vested

Hong Leong Bank (HLBK MK)

1HFY20: Solid Loans Growth And Cost Management

HLBK’s 1HFY20 was above expectations, driven by lower-than-expected provisions and solid operating cost management.

2QFY20 pre-provision operating profit growth came in at a solid 12.5% yoy.

Share price was recently impacted by fears that the coronavirus would impact its associate Bank of Chengdu’s performance, which has held up relatively well.

Maintain BUY with a lower target price of RM18.96 (1.47x FY20F P/B, 10.0% ROE) as we build in the high probability of another 25bp OPR cut in 1H20.

Source: UOBKH

https://research.uobkayhian.com/content ... a6a3e35230

[winston]

not vested

Hong Leong Bank upgraded to ‘buy’ as associate Bank of Chengdu's shares rally — CIMB Securities

By Jazlin Zakri

Bank of Chengdu’s share price rally was boosted as part of the finalisation of the US’ tariffs on China, with its share price hitting a new high of 19.57 yuan (RM11.58), up 21.7% from a recent low of 16.05 yuan in February,

As a result, the value of Hong Leong Bank’s 17.8% stake rose, with its portion of the Chinese associate’s market capitalisation increasing by 11.9% in value, or RM922 million, reaching RM8.7 billion as of June.

Expects Hong Leong Bank’s dividend outlook to improve, projecting yields of 4.5% for FY2026 and 5.1% for FY2027, underpinned by higher payout ratios following the implementation of Basel III reforms in 2026.

The bank’s asset quality continues to outperform industry peers, with a gross impaired loans ratio of 0.57% in 3QFY2025 — well below the sector average of 1.42%.

Source: theedgemalaysia.com

https://theedgemalaysia.com/node/759752

[winston]

not vested

May 28, 2025

Hong Leong Bank’s 3Q profit drops due to dilution losses, lower earnings from associate companies

By John Lai

Hong Leong Bank Bhd (KL:HLBANK) posted a 9.4% drop in net profit for the third quarter ended March 31, 2025, mainly due to dilution losses from two China-based firms.

The decline was mainly attributed to dilution losses totaling RM407.6 million and a RM60 million decline in profit from its associated companies.

The group said the biggest hit came from a RM393 million non-cash loss following the dilution of its equity interest in Bank of Chengdu Co Ltd from 19.8% to 17.8%, after other partners converted their convertible bonds into new shares.

In a separate move, Hong Leong Bank divested a 10% stake in its associate Sichuan Jincheng Consumer Finance Co Ltd, reducing its holding from 12% to 2%, resulting in a further RM15 million dilution loss.

Despite the dip in profit, the bank’s revenue rose 7.8% year-on-year to RM1.55 billion from RM1.44 billion, driven by strong loan growth both locally and abroad.

Source: theedgemalaysia.com

https://theedgemalaysia.com/node/757015

[winston]

vested

Sep 2024

Hong Leong Bank may reduce China stake as investment pays off

Its group earnings edge on overreliance on the Bank of Chengdu’s contribution.

The Malaysian banking group’s 19.8% stake in BOCD is now worth MYR6.2b, against its cost of investment that was MYR2.1b in July 2008.

Mulling reducing its stake in the Chinese bank to as low as 15%.

Hong Leong Bank can cut its BOCD stake via converting about RMB5b in convertible bonds. This will dilute its stake from 19.8% presently to 17.8%.

Source: Asian banking & Finance

https://asianbankingandfinance.net/reta ... t-pays-off

[winston]

vested

Hong Leong Bank 4Q net profit up 5%, declares 68 sen dividend

KUALA LUMPUR (Aug 27): Hong Leong Bank Bhd's (KL:HLBANK) fourth quarter ended June 30, 2025 net profit was up 5.28% on higher net interest income, stronger Islamic banking contributions and improved fee-based income.

Net profit for the quarter stood at RM1.09 billion, compared with RM1.03 billion a year ago.

Net interest income grew 4.16% to RM1.02 billion from RM981.1 million, while Islamic banking income surged 16.43% to RM302.6 million and other operating income rose 25.45% to RM295.7 million.

The group posted a pre-tax profit of RM1.36 billion for the quarter, up RM76.4 million or 6.0% from the same quarter last year.

The increase was mainly due to higher net income, which was up RM143.5 million, and lower operating expenses, which were down RM2.5 million.

However, this was partly offset by higher impairment losses on loans of RM34.1 million and lower profits from an associated company, which were down RM35.5 million.

The group posted revenue of RM1.62 billion for the quarter, compared with RM1.48 billion a year ago, a bourse filing showed.

The bank declared a final dividend of 68 sen per share, bringing the total payout for FY2025 to 96 sen per share — an increase of 28 sen compared with last year’s 68 sen dividend.

Source: theedgemalaysia.com

https://theedgemalaysia.com/node/768321

[winston]

vested

FY25 results within expectations

BUY maintained HL Bank’s FY25 results were within expectations and positively, the group’s dividend payout ratio has risen to 46% from 33% in FY24.

Our forecasts are maintained, but we have raised our payout ratio assumption to 46% as well.

The higher dividend payout now positions HL Bank closer to its banking peers, lifting its dividend yield >5%.

We maintain our TP of MYR22.80 (CY25 PBV: 1.2x. COE: 10.3%. R0E: 11.2%, LT growth: 4%).

We continue to like HL Bank for its strong asset quality, liquid balance sheet and management’s proactive stance in driving faster domestic growth.

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/482159.pdf

[winston]

not vested

Hong Leong Bank (HLBK MK) 4QFY25: Solid All-round Performance

Hong Leong Bank’s core FY25 earnings are broadly in line, supported by provision writebacks, strong NOII, positive operating JAWS and robust loan growth.

We continue to like Hong Leong Bank for its ability to deliver above-industry growth while sustaining impeccable asset quality.

Its valuation remains attractive at 1.00x P/B vs the sector’s 1.15x, despite stronger ROEs.

Maintain BUY with a target price of RM23.80 (1.19x FY26F P/B, 11.5% ROE).

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email