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at the back of its growing revenue, net interest income went up while non interest income came down or rather flat over the last 3 years. while it is still a strong and efficient bank, the possibility of lower interest rates will hit its net interest income if it happens. that will put it in a spot of lower revenue if nothing is done to grow its non interest income. that is one possible reason for long term investor to get out.
eng, please do your own due diligence as it's just my opinions. (1) pbbank has been on the bullish run since 2016. for the very first time, the price came below 200 days MA. (2) market is pricing in the possibility of interest rate cut. as shared above, if it happens, it will hit its net interest income leading to possible lower revenue. it's non interest income has declined last year and flat for the last 3 years. doing nothing will impact its net interest margin.
(3) it is still too early to say that the corrections to its last 3 years bullish run has ended with the drop today. (4) possible immediate support at 22.20 and a healthy retracement to 20.0 is very possible. (5) if your avg price is below 20.0, that will give you an opportunity to top up. (6) do follow its qtr report to see how its progressing in terms of growing its non-interest income. hope this helps.
hi yet lian, I am not aware of the interest rates expecting to go down. I was following the progress from bank negara websites including its annual report. as for public bank, I was looking at its financial performance and historically and conservatively, it's revenue source has always been focusing on net interest income which contributes to about 70% of its revenue.
the topics of interest rates / monetary policy is always a hotly debated topics when it comes to economic stimulus during slow down or down turn. hence, if there is a change in the interest rates, the net interest margin or commonly known as NIM for banks will be affected.
banks can either aggressively increase its net interest income or non interest income to minimize its impact. in my opinion, pbbank will probably focus on growing it's net interest income - more loans. again, have to look at its strategy/report moving forward.
