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2009-6-16 09:28:00 a.m. HKT, XFNA
DJ MARKET TALK: HK Banks' 1H09 Results Likely Mixed - Citi
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| 0909 [Dow Jones] Hong Kong banks' 1H09 results offer key near-term risk as likely to be mixed, with NPLs, credit costs likely to be benign and positively surprise, while credit growth, NIMs likely to be weak, Citigroup says. But notes, HK bank stocks now generally trade about 10%-20% below mid-cycle P/Bs; current property revaluation cycle should be positive as HK banks tend to outperform during property reflation, rising property prices offer positive credit-quality support. Adds, optimistic pilot CNY trade settlement plan will proceed despite recent delay, believes likely to lead to net liquidity inflows, creating new revenue opportunities for sector. Raises sector FY09-10 EPS forecast average 13%, 26%, mainly on lower NPL, credit cost estimates. Upgrades BOC Hong Kong (2388.HK) to Buy from Hold. Raises both Dah Sing Banking (2356.HK), Dah Sing Financial (0440.HK) to Buy from Sell. (LES) Contact us in Hong Kong. 852 2802 7002; MarketTalk@dowjones.com
(Delayed by 1 hour)
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