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Bank Industry Risk Analysis: Malaysia Feb 05
Standard & Poors, Feb 2005
Abstract
By international standards, risks in Malaysia's banking and finance industry are moderate. The key risks in the system are: Narrowing interest margins given the increased competition amid a narrow lending focus to consumers and small and midsize enterprises (SMEs); Cyclical propensity for corporate borrowers to overleverage; and Regulatory forbearance. The more positive factors mitigating these industry risks include: An industry structure that allows for moderate competition; Improving asset quality and satisfactory capitalization in the system; and Demonstrated system support by the government. The Malaysian banking landscape underwent substantial transformation in late 1999, where as part of the first phase of the Financial Sector Master Plan, the banking system entered a phase of mergers and acquisitions after years of persuasion by...
Companies mentioned in this report are: Malayan Banking Bhd.,Public Bank Bhd.,Affin Bank Berhad,RHB Bank Bhd.,CIMB Bank Bhd.,Southern Bank Berhad,Hong Leong Bank Bhd. (Unsolicited Ratings),Alliance Bank Malaysia Berhad,AmInvestment Bank Bhd.,CIMB Investment Bank Bhd.,EON Bank Berhad,CIMB Group Holding Bhd.
Standard and Poors RatingsXpress Credit Research provides in-depth coverage of international corporates, financial institutions, insurance companies, utilities, sovereigns and structured finance programs. RatingsXpress Credit Research lets users determine the credit rating of holdings and identify key factors underlying an issuer's creditworthiness, distinguishes the different risk exposures for new and existing deals, and provides an understanding of how their analysts interpret key regulatory, political and environmental events and their economic impact.
Research Type: Commentary
Criteria articles describe the thought process and methodology Standard & Poor's analysts use in determining ratings. These commentary pieces discuss both the quantitative (economic and financial) and qualitative (business analysis and caliber of management) aspects of the analysis, as well as legal issues.
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