In its report, Maybank IB said that the FY23 return on equity (ROE) estimate of 9.2% trails RHB’s 1H23 ROE of 10.6% on expectation of a weaker 2H23 due to higher credit cost.įY23 forecast net interest margin (NIM) was assume to compress a bit more stabilizing. Our previous dividend payout ratio assumption of 62.5% for FY23/24E appears optimistic at this stage, for which we are lowering to 50%,” the report said. “Moving forward, RHB maintains a minimum payout ratio policy of 30% but its management will strive for a higher payout ratio. “We understand that RHB’s dividend payout ratio of 62.9% in FY21 was in response to a low payout ratio of 34.8% in FY20, while the 62.5% payout ratio in FY22 was due to the lower earnings base caused by Cukai Makmur. In its Research Note, Maybank IB has lower the dividend payout assumption ratio to 50% from 62.5% for RHB in the financial year 2023 (FY23) and FY24. It holds unchanged TP of RM6.20 on FY23F/FY24F earnings raised. Maybank Investment Bank (Maybank IB) Research maintains a HOLD call on RHB Bank (RHB) but has raised its net profit forecasts by 3 to 5 per cent to factor in lower credit cost assumptions.