MAYBANK (1155): Maybank’s “Super Growth” Strategy Targets Capital-Light Non-Interest Income Boom
Summary (TL;DR):
- Research Firm: RHB Investment Bank
- Subject: MAYBANK / MAYBANK (1155)
- Core Rating: BUY
- Target Price / Top Picks: MYR 10.90
- One-Liner: Maybank’s ‘Super Growth’ investor day highlights capital-light non-interest income drivers from wealth management, mid-market, and global FX sales, reinforcing its defensive investment appeal.
Report at a Glance
RHB Investment Bank released its latest research report on MAYBANK on 2025-07-07, maintaining a “BUY“ rating with a target price of MYR 10.90. The core thesis of the report is that Maybank’s strategic focus on capital-light, non-interest income growth areas such as wealth management, mid-market segments, and global market FX sales, as revealed during its ‘Super Growth’ investor day, along with its defensive attributes, underpins its positive outlook.
Investment Thesis (The Bull Case)
- Wealth Management (WM) Expansion: Maybank aims to double total financial assets, revenue, and wealth contribution to group fee income from 2024 levels, leveraging its substantial deposit base for conversion into WM products, digital transformation, and expansion into high-potential markets like Indonesia and the Philippines, with a focus on Islamic wealth.
- Mid-Market Segment Growth: The bank is adopting a targeted approach in high-growth areas (Penang, Johor, Sarawak, Singapore) and sectors (Johor-Singapore Special Economic Zone, data centre, semiconductor), showing positive growth momentum without sacrificing asset quality, and yielding a lucrative ROA of 1.5% (vs group ROA of 1%).
- Robust Global Market FX Sales & Defensive Qualities: Maybank is broadening its FX ecosystem and driving revenue growth through cross-selling and increasing wallet share, notably with the success of its Global Access Account-I. Additionally, the bank is considered defensive due to its relatively low foreign shareholding (c.19%), commitment to at least retain absolute DPS, and healthy MYR1.8bn overlay buffers for asset quality risks.
Potential Risks (The Bear Case)
- Risk 1: Higher-than-expected credit costs.
- Risk 2: Weaker-than-expected Net Interest Margins (NIMs).
- Risk 3: Weaker-than-expected non-interest income (non-II).
Financial Forecast Summary
The analyst’s financial projections for the coming years are as follows:
| Fiscal Year (YE to Dec) | FY25F | FY26F | FY27F |
|---|---|---|---|
| Revenue (RM mil) | 30,501 | 32,095 | 33,641 |
| Net Profit (RM mil) | 10,364 | 10,947 | 11,459 |
| EPS (sen) | 86 | 91 | 95 |
| DPS (sen) | 62 | 64 | 67 |
| Dividend Yield (%) | 6.4 | 6.6 | 6.9 |
| P/E Ratio (x) | 11.34 | 10.74 | 10.26 |
(Source: RHB Investment Bank research report)
Valuation & Target Price
| Rating | BUY |
| Last Close Price | MYR 9.74 |
| Target Price (TP) | MYR 10.90 |
| Valuation Methodology | The target price is derived from a GGM-based intrinsic value with an ESG overlay. Key GGM assumptions include a Cost of Equity (COE) of 9.25%, ROE of 11%, and long-term growth of 3.5%. A 4% ESG premium is applied due to Maybank’s 3.2 ESG score (out of 4) being above the country median of 3.0. |
Analyst’s Conclusion
- Overall Stance: The analyst maintains a positive outlook (“BUY” rating) on Maybank, driven by its strategic initiatives for capital-light, non-interest income growth and its inherent defensive characteristics.
- Key Catalyst/Strength: The bank’s focus on expanding wealth management, mid-market, and global market FX sales, which are capital-light and enhance non-interest income, coupled with its strong asset quality and dividend visibility.
- Major Headwind/Risk: Key risks include potential increases in credit costs, compression in Net Interest Margins (NIMs), and a slowdown in non-interest income growth.
- What to Watch: Investors should monitor the execution and impact of Maybank’s “Super Growth” strategies, particularly the conversion of deposits into wealth management products, the expansion into targeted mid-market sectors, and the growth in global market FX sales. Also, keep an eye on overall asset quality trends and NIM performance.
Disclaimer: This article is a summary and interpretation of a research report published by RHB Investment Bank on 2025-07-07. All information is for reference purposes only and does not constitute investment advice. Investors should conduct their own independent research and due diligence and assume all associated risks.
