Hong Leong Bank's profit outlook positive amidst SME lending boost

It is projected to maintain tangible common equity at approximately 14% of risk-weighted assets.

Moody's Ratings forecasts Hong Leong Bank’s problem loan ratio to stay low, between 0.5% to 1.0% over the next 12 to 18 months, with problem loan coverage at 155% as of June.

Risks to asset quality stem from HLB's plans for increased lending to Malaysian SMEs and expansion overseas.

HLB's return on tangible assets is expected to remain stable at around 1.4%, with a gradual recovery in net interest margins from early 2023.

Although profits from minority investments, particularly in the Bank of Chengdu (BOCD), contribute over 30% to pre-tax profits, limited control over BOCD and its expansion strategy introduces potential risks.

The bank is projected to maintain strong capitalisation, with tangible common equity at approximately 14% of risk-weighted assets over the next forecast period.

Liquidity remains robust, supported by HLB's retail base, with an average liquidity coverage ratio of 127% in the second quarter of 2024, above the 100% regulatory minimum.

Follow the link for more news on

Moody's Ratings

risk management

Also Read

Japan Post Bank posts $1.44b net income for H1 FY2025/3

SMFG reports $4.86b profit for H1 FY2024

Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

I want to download the media kit