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PETALING JAYA: Research firms have maintained their positive call on CIMB Group Holdings Bhd after its Indonesian banking subsidiary, PT Bank CIMB Niaga Tbk (CIMB Niaga), reported a favourable first-quarter performance ending March 31 (Q1 2024).

In separate statements, Maybank Investment Bank (Maybank IB) affirmed its “buy” rating on CIMB Group with an unchanged target price (TP) of RM7.40.

“CIMB Niaga’s Q1 2024 net profit of 1.68 trillion rupiah (RM494 million), representing 24% of our full-year forecast, is within our expectations.

“While the net interest margin (NIM) was lower than expected, this was offset by a very benign credit cost environment, which is expected to be sustained,” said Maybank IB following CIMB Niaga’s strongest result to date.

Meanwhile, Kenanga Research maintained a “market perform” stance on CIMB Group, setting a TP of RM6.60 per share.

“CIMB Niaga has made headway in regaining NIMs, despite the central bank’s potential near-term disruption from a surprise interest rate hike. However, its improving asset quality signals longer-term sustainability,” the research house said.

Kenanga added that the banking group remains steadfast in its pursuit of achieving its initial NIM target of 4.2% to 4.4% for the 2024 fiscal year.

“We may continue to see earnings uplifted by comparatively better provisioning needs as economic activity picks up within the country, with CIMB Niaga being evenly exposed between consumer retail and business portfolios,” it added.

At noon, CIMB’s shares rose by two sen to RM6.63, with 4.12 million shares traded.