Maybank Faces Challenging Second Half of 2026

Maybank faces a demanding second half of 2026 as it tries to prove that its weaker return on equity reflects a temporary cycle rather than a deeper structural problem.

The bank recorded a first-half ROE of 11.6%, below its 11.8% target, although core net profit improved again in the second quarter. CIMB Securities said execution in the second half will be important for restoring confidence in Maybank’s medium-term ROE goal of 13% to 14% under its ROAR30 strategy.

The research house identified several priorities. Maybank needs to keep its net interest margin near the upper end of its 2.05% to 2.10% guidance range by growing current and savings accounts, optimizing its funding mix and selectively repricing assets. It must also balance margin protection with asset growth and contain deterioration in asset quality, particularly in Malaysia’s retail, automotive and small and medium-sized enterprise segments.

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The bank also needs to remain disciplined in balancing margin with asset growth.

CIMB Securities expects the bank to keep credit costs near 20 basis points and loan-loss coverage above 100%. It also expects the cost-to-income ratio to remain around 49%, even as Maybank increases investment in technology and artificial intelligence.

The bank will also need to optimize capital and risk-weighted assets following the Etiqa-Maybank Ageas Holdings transaction. CIMB Securities maintained its hold recommendation and RM10.50 target price, citing the need to narrow the gap to the ROE target while preserving an attractive dividend profile. It placed the 2026 and 2027 financial-year dividend yields at 6.4% to 6.7%. Hong Leong Investment Bank said stronger deposit competition and rising funding costs in Malaysia could keep pressuring margins, with less favorable asset-liability repricing in Singapore and Indonesia adding to the strain. Additional funding needs for the acquisition could increase pressure, although stronger loan growth may partly offset it.

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Maybank also needs to control deterioration in asset quality, particularly in the retail, automotive and small and medium-sized enterprise segments in Malaysia.