Latest news with #MBSB
Focus Malaysia
4 days ago
- Automotive
- Focus Malaysia
Malaysia's RM63 bil semiconductor push shows progress, but value chain ascent still early
MBSB Research is maintaining their neutral stance on the technology sector following their participation in the recently concluded ASEAN Semiconductor Summit 2025 (ASEMIS). The government's effort to reestablish the country's positioning in the semiconductor global supply chain has started to yield results. A year after the announcement of the National Semiconductor Strategy (NSS), a notable strategic investment of RM63 bil has been secured, along with over 13k talent being groom as well as wider research and development (R&D) footprint. IN 2023, the ASEAN semiconductor market stood at over USD 31 bil. By 2032, the ASEAN semiconductor market has the potential to exceed USD52 bil by moving up the value chain. To further drive growth in the Malaysia as well as the broader ASEAN semiconductor landscape, the government put forth three new measures in the areas of capital, G2G collaboration and talent. 'While we acknowledge the milestone and commitment to the target set, we view that we are still at an early stage of the progress. Thus, more time is required to climb up the semiconductor value chain,' said MBSB. The NSS was announced in May 2024 to redefine the country's position in the global semiconductor supply chain. It focuses on integrated circuit (IC) design, advanced packaging and advanced manufacturing equipment. In addition, it also seeks to train 60k high-skilled engineers and establish a global R&D hub for semiconductors. As of March 2025, Malaysia has secured over RM63 bil in semiconductor investments. Of this RM 59 bil originated from foreign investors while the remainder RM5 bil came from domestic sources. Some of the notable projects include Carsem's advanced packaging for energy efficiency, EV, connectivity and AI; NXP's semiconductor products, Infineon's world's largest 200mm silicon carbide (SiC) power fab, Syntiant's MEMS microphone and sensors; and Plexus' manufacture and re-manufacture of Printed Circuit Boards. Meanwhile, more than 13k highly skilled workers have been trained through national programmes such as CREST's ETSI and TalentCorp's MyMahir initiative. The R&D footprint is also growing, supported by including Penang's Silicon Design@5km+, Selangor's IC Design Park and Sarawak's SMD Semiconductor initiative. Firstly, the government aims to unlock more catalytic capital to support early-stage R&D, product development, and ecosystem scaling. This includes a suite of targeted financing instruments, matching funds, and customised incentives, alongside continued investments by the GLICs. Secondly, the government is also seeking deeper G2G cooperation. This will be carried out via the creation of ASEAN Framework for Integrated Semiconductor Supply Chain (AFISS). The framework will revolve around policy alignment, infrastructure readiness and deeper cross-border collaboration. Thirdly, to further close the gap on talent shortage, the government will also drive stronger collaboration across public, private, and academic institutions. This also extends to intensifying R&D efforts through strategic collaboration between government, industry, and academia. —July 1, 2025 Main image: The Malaysian Reserve
Malaysian Reserve
21-07-2025
- Business
- Malaysian Reserve
China, Singapore likely to perk up if Malaysia eases foreign banking ownership
THE United States is pressing Malaysia to ease up its foreign ownership for financial institutions as both nations are engaged in tariff talks. But such a move may not attract banks from the US, rather it may wet the interests of players from China and Singapore. 'We think more interest will come from regional players rather than the US – especially countries such as China and Singapore which have a strategic stake in Malaysia,' MBSB Research said in a note released today. It listed smaller banks such as AMMB Holdings Bhd, MBSB and Affin Holdings Bhd as potential targets. ' AMMB remains a long-discussed M&A target, due to its relatively smaller size and fundamental improvements seen over the last couple of years – coupled with talk that its key shareholder (founder Tan Sri Azman Hashim) is willing to part with some shares if valuation is acceptable. In the case of AFFIN, Bank of East Asia is said to have been looking to dispose of its holdings for quite some time,' it said. In the last few years, Alliance Bank Malaysia Bhd, another one of the smaller banks in Malaysia, has been linked to a potential alliance or acquisition involving Singapore's largest banking group DBS Group Holdings Ltd. Such a move would pave the way for the region's financial giant to enter the Malaysian market, following the footsteps of Singaporean banks like United Overseas Bank (M) Bhd (UOB) and OCBC Bank (M) Bhd who already operate. The report noted that financial liberalisation does have multiple benefits, most notably driving FDI interest and industry-wide improvements in efficiency and profitability. Unfortunately, this may come with large-scale rationalisation of the work force. In recent reports, Minister of Investment, Trade and Industry Tengku Zafrul Abdul Aziz has indicated that the US has asked Malaysia to lift foreign equity restrictions in strategic sectors as part of its tariff negotiations. The current ruling stipulates that commercial banks must have a 30% cap on foreign ownership, while investment banks and Islamic banks have a 70% cap. However, this rule has been bypassed multiple times – we think this is to avoid single exposure risk, as there are not sufficient domestic investors, added the MBSB Research report. It said that Malaysia's commercial banks have some of the strictest restrictions imposed – hence a liberalisation measure could put it more in line with the rest of the region. It added that Western players like Citibank and Standard Chartered have pulled operations from ASEAN recently, due to over competitiveness. MBSB Research, formerly known as MIDF Research, is part of MBSB Investment Bank Bhd, formerly known as MIDF Amanah Investment Bank Bhd. — TMR
Focus Malaysia
21-07-2025
- Health
- Focus Malaysia
World-class healthcare at affordable prices draws foreign patients
MALAYSIA has strategically positioned itself as a leading healthcare destination on the global stage, attracting a growing number of international patients seeking high-quality, affordable medical care combined with a pleasant travel experience. 'The country's healthcare sector is also attractive for investments, underpinned by several key factors,' said MBSB in a recent report. Among them are the world-class quality medical care and advanced facilities, high accreditation and standards that ensures adherence to global benchmarks for patient safety and quality of care and the high-skilled professionals trained in leading institutions globally. Also, Malaysia has state-of-the-art technology allowing advanced treatments across various specialties, affordable and competitive pricing for treatments, often offering savings of over 50% for similar procedures to Western countries and regional counterparts. The healthcare sector also has regulated cost on certain procedures and services, transparent healthcare plans, easy accessibility and connectivity to medical facilities, and easy communication due to multilingual and multicultural medical staff. Malaysia as a global halal hub, promotes halal-certified medications and respect for patient modest, and it will benefit from the booming medical tourism, supported by upmost hospitality. However, the country is moving from a developing to a high-income nation, and its healthcare system is grappling with the complexities that come with this transition. The epidemiological shift from communicable to NCDs, coupled with an aging population, reflects a maturing society that now faces diseases of affluence and lifestyle. The challenges are no longer just about basic access (which has largely been achieved in Peninsular Malaysia), but about quality, efficiency, equity, and sustainability in the face of rising costs and demand. Malaysia is not adhering rigidly to one ideological model (fully public or fully private). Instead, it's embracing a pragmatic, dual-tier system with increasing public-private partnerships (PPPs). The government's continued heavy subsidization of public healthcare and the active pursuit of UHC through various initiatives (PeKaB40, SPM, National Health Fund exploration) demonstrate a fundamental commitment to ensuring that healthcare remains a right for all citizens, not just a privilege. This is evident by the Budget 2025's allocation of RM45.3b for the local healthcare sector. The willingness to address high OOP payments also directly signifies a focus on financial risk protection for its citizens. MoH's emphasis on digitalization, data analytics, and value-based healthcare also indicates a forward-looking approach, recognizing that technology and efficiency are critical for future sustainability. Beyond providing care for its citizens, Malaysia actively promotes itself as a leading healthcare destination. As of writing, Malaysia was announced as the number one destination for medical tourism, with over RM2 bil revenue generated per year on average from over 1.3 bil foreigners seeking medical help using local facilities and infrastructure for treatments and surgeries. This also demonstrates an understanding of healthcare's dual role as a social service and a significant contributor to the national economy, attracting foreign exchange and creating high-value jobs. The Global Halal Hub aspect further showcases a strategic niche marketing approach that caters to specific global demographics. All in all, Malaysia is in a critical phase of healthcare transformation. It has a strong foundation, a clear understanding of its complex challenges, and an ambitious roadmap for reform. The success of this journey will depend on its ability to effectively implement these strategic changes, foster collaboration between its public and private sectors, and sustain the political will to navigate the inherent difficulties of such comprehensive reforms, ultimately aiming for a truly equitable, high-quality, and sustainable healthcare system for all its people. We reiterate our positive call for the sector, backed by the strong drivers that will continue to feed the sector's growth in the near term. —July 21, 2025 Main image: Arab Watch Coalition
BusinessToday
26-06-2025
- Business
- BusinessToday
MBSB's Road To Recovery
RHB Investment Bank Bhd (RHB Research) has initiated coverage on Malaysia Building Society Bhd (MBSB) with a NEUTRAL call and a target price of RM0.67, implying a slight downside of 2% from its current market price of RM0.68. The research house noted that while the stock offers a dividend yield of approximately 6% for FY25, the group remains in a transitional phase, aiming to rebalance its funding and financing mix to lift asset quality and earnings over the next two years. According to RHB Research, MBSB is currently executing its 'Flight26' strategy, which targets an 8% return on equity (ROE) by FY26. This will be driven by a combination of improved funding costs, better-quality loan underwriting, treasury gains, and enhanced operational efficiency. However, with ROE at just 4% in FY24, the research house believes the path to recovery will take time and expects ROE to reach only 5.4% by FY26, still below the banking sector's average of around 11%. On capital strength, the house highlighted that MBSB has the highest common equity tier-1 (CET-1) ratio among its peers at 19.4%. This positions the group favourably to pursue growth while maintaining attractive dividend payouts. The bank is also targeting a financing growth compound annual rate of 8% from FY24 to FY26, above industry average. RHB Research assumes a 70% dividend payout ratio, below MBSB's informal guidance of around 90%, but this still results in strong projected yields of 6–7% over FY25–26, which should lend support to the share price. However, the report also flagged concerns around asset quality. MBSB's gross impaired financing (GIF) ratio stood at 5.5% in 1Q25, significantly higher than the 0.5–2.2% range reported by other Islamic banks. Much of these impaired loans stem from legacy construction and personal financing segments. The house noted that around 95% of GIFs are collateralised, reducing the likelihood of substantial provisioning top-ups, but added that recoveries may take time due to protracted legal proceedings. From a valuation perspective, RHB Research applied a Gordon Growth Model-derived price-to-book value of 0.54 times, including a 2% premium for environmental, social and governance (ESG) considerations, giving rise to the fair value of RM0.67. While recognising MBSB as a potential Shariah-compliant alternative in the financial sector, RHB Research cautioned that the group's earnings turnaround and asset quality improvements remain key watch points. The stock, which is trading near its 52-week low of RM0.63, has fallen 24% over the past year. Overall, the investment bank believes MBSB presents a capital-rich yet operationally cautious profile, well-suited for yield-focused investors but requiring more time to prove its strategic execution. Related
The Star
26-06-2025
- Business
- The Star
MBSB moves towards major funding rebalancing
PETALING JAYA: MBSB Bhd 's financial year 2025 (FY25) and FY26 are seen as a period of transition that involves a major rebalancing of its funding and financing mix to improve asset quality, says RHB Research. The research house, which had initiated coverage on the stock, noted that the transition would take time to kick in. MBSB continued to hold on to excess capital, which its management intended to utilise for growth while maintaining attractive dividend payouts. Under its Flight26 strategy, the company plans to achieve an 8% return on equity (ROE) by FY26. 'This is premised on a stronger earnings profile from a better funding mix (allowing the group to underwrite better-quality financing without sacrificing net interest margin), enhanced fee income and treasury gains, and operating expenditure discipline,' the research house added. The FY26 target implied a doubling of ROE from the 4% achieved in FY24, albeit below the sector average of about 11%. MBSB commands the highest Common Equity Tier-1 ratio in the sector at 19.4%, with room for further uplift given its sector-high risk-weighted assets density of 74% versus comparable peers' at 55% to 65%. RHB Research said this allowed the group to aim for above-industry financing growth – Flight26 target: FY24-FY26 compounded annual growth rate (CAGR) of 8% – while still preserving capital for consistent and attractive dividend payouts. However, MBSB asset quality metrics lagged that of its peers, it pointed out. MBSB's gross impaired financing (GIF) ratio in 1Q25 stood at 5.5%, well above the 0.5% to 2.2% range of its peers. 'We understand that a significant portion of the group's GIFs come from legacy construction and collateralised personal financing accounts (collectively forming about 30% of total GIFs), but these have a long legal process and recovery period,' it noted. As 95% of GIFs are collateralised, MBSB management is comfortable with its coverage levels, and no significant top-ups to provision buffers are expected. That said, management's focus on lowering cost of funds should allow it to better compete for higher-quality financing, which is positive for future GIF formation and credit cost trajectory. RHB Research projected a 14% FY24-FY27 net profit CAGR, premised on operating income CAGR of 9% from both net financing and non-financing income, positive jaws underpinned by cost discipline and credit costs of 30 basis points (bps) to 35 bps. 'Our earnings forecasts generate an FY26 ROE of 5.4%, which is short of management's 8% target. We also assume a 70% dividend payout ratio versus management's circa 90% informal guidance, which translates to attractive FY25-FY26 yields of 6% to 7%, offering downside support,' it said. It has a 'neutral' call on the stock with a target price of 67 sen per share.
