Analyst cuts Aeon Credit forecasts on digital bank losses
Aeon Credit, which holds a 50 per cent stake in Aeon Bank, expects to incur losses of between RM80 million and RM90 million from the digital venture due to continued expansion and product development costs.
In a note, CIMB Securities projected Aeon Bank to post losses of RM85 million in financial year 2026 (FY26), RM60 million in FY27 and RM35 million in FY28.
"We forecast continued losses in FY28, reflecting a more cautious stance amid a weak macro backdrop, prolonged gestation period for digital platform profitability, and sustained tech-related cost pressures," the firm said.
As a result of its 50 per cent stake, Aeon Credit will book half of Aeon Bank's losses into its own earnings over the forecast period.
CIMB Securities also factored in a 25-basis point cut in the overnight policy rate (OPR), but noted that the impact on earnings would be minimal.
This is because Aeon Credit's lending rates and funding costs are largely fixed, with about 65 per cent of its funding sourced from Japanese banks at stable rates.
The research house expects Aeon Credit to report a net profit of RM96.8 million for the first quarter of FY26, representing a 26.1 per cent quarter-on-quarter drop and a nine per cent decline year-on-year. The company is scheduled to release its results on July 8.
CIMB Securities maintained its "hold" recommendation on the stock, but revised its target price slightly lower from RM5.80 to RM5.70.
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