Asean banks' asset quality risks still high, green shoots muted: Maybank KE

Singapore

MAYBANK Kim Eng (MKE) has downgraded its sector outlook on Asean banks to negative as their asset quality risks remain high while operational recovery may stay muted.

"As moratoriums begin to unwind, starting from Q3 in Malaysia, we expect additional asset quality pressures to surface," the research team wrote in a report on Friday night.

In particular, banks that have a domestic focus may see higher operational pressures, especially if economic activities fail to pick up pace.

MKE's top "buy" ideas for the region - taking into account diversification, capital levels and structural growth - are Singapore's DBS, Malaysia's Hong Leong Bank and Vietnam's Techcombank. On the other hand, MKE has a "sell" rating on Indonesia's Bank Central Asia, Bank Rakyat Indonesia and Thailand's Kasikornbank, given their "elevated provisioning risks and v…

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