CIMB Group Holdings Berhad

CIMB reported Q2 2026 net profit of MYR 1.94 billion and an annualized ROE of 11.2%. Khairul said NOII grew 6% quarter-on-quarter, total income rose 2.8%, assets grew 2.2% q/q, loans grew 1.1% q/q, and NII rose despite a 4 bps NIM decline. Credit cost was 38 bps in the quarter, and half-year annualized credit cost was 34 bps, within the 25 to 35 bps guidance range. The cost-to-income ratio was 45.2%, GIL fell to 1.6%, CET1 was 14%, and the dividend was MYR 0.1965 per share with a payout ratio above 55%. Management said 2026 guidance was maintained, with full-year margins expected to be flat to down 10 bps, total asset growth and NOII expected to offset margin pressure, and capital return plans still on track.

Novan Amirudin framed the quarter as evidence that Forward30 is gaining traction, especially through the ‘4 Cs’ of capital, cash, cross-sell, and capabilities. He emphasized that CIMB is selectively exiting underperforming businesses, reinvesting capital into higher-growth areas, and leaning into ASEAN themes such as AI data centers, wealth, and cross-border flows. His tone was confident but cautious on the environment, repeatedly noting that the bank is defending margins, managing liquidity carefully, and continuing to simplify operations to drive lower costs.

Khairul Rifaie focused on the mechanics behind the quarter: strong NOII, controlled costs, and conservative overlays. He said the quarter included a MYR 60 million retail ECL impact tied to an OJK accounting/treatment change in Indonesia, and that the half-year annualized credit cost of 34 bps remained inside guidance. He also highlighted 10 bps year-on-year margin compression, but said Malaysia, Indonesia, and Singapore each had specific offsetting levers, and reiterated that OpEx was well contained while investment in tech remained around the 8% tech CRR level. He also confirmed the 55% payout ratio, equivalent to MYR 2.1 billion, and said liquidity and capital remained very strong.

Analysts focused on three main issues: the Indonesian OJK rule change and its effect on credit costs, the direction of NIMs and liquidity optimization, and the sustainability of wealth income. Management said the OJK change is a timing issue that moves value from NOII to ECL, and the group’s diversified earnings base keeps credit-cost guidance unchanged. On NIMs, they said Malaysia is facing deposit competition, Indonesia was disrupted by a 100 bps rate hike, and the group is using FDs, CASA, and offshore funding to stabilize margins; on wealth, they said inflows are partly macro-driven but should be sustained by CIMB’s product manufacturing, wholesale franchise, and new Private Wealth offering. They also addressed Indonesia free-float requirements, saying they are exploring all options, including institutional or strategic placements.