Brokerage flags concerns over banking industry
PETALING JAYA: Concerns have been flagged for the banking sector by CGS-CIMB, following the continuous weak top-line growth in the fourth quarter of 2018.
The research house said the sector’s operating revenue fell 1.4% year-on-year (y-o-y) in the fourth quarter, being the third consecutive quarter of decline.
“Although we can blame the lethargic investment income for the above, banking revenue was also affected by tepid fee income growth and the erosion of net interest margins at most banks,” it said.
Adding to that is the projected slower economic growth and weak property market that CGS-CIMB expects will reduce loan growth to around 5% this year from 5.6% in 2018.
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