Malayan Banking - Chalked Poor Numbers at Indonesia

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Maybank Indonesia saw net profit dropped 16% YoY in 2Q20, no thanks to tepid total income and surge in bad loan provision. Also, loans continued to contract and NPL ratio has risen further. Overall, results were largely within expectations and hence, forecasts were unchanged. In our opinion, the stock’s risk-reward profile remains balanced as there are no compelling re-rating catalysts, despite being able to offer superior dividend yield. Keep HOLD and GGM-TP of RM7.55, based on 1.01x FY21 P/B.