CIMB Bank Central Asia Result note - Anticipating a rough year

Bank Central Asia Result note - Anticipating a rough year - by Mulya Chandra CFA
(BBCA IJ / BBCA.JK, NEUTRAL - Maintained, Rp3,075 - Tgt. Rp3,350, Financial Services)

BCA's FY08 results beat consensus and our expectations on a lower tax rate. The bank continued to raise its provisioning coverage in 4Q08 to 408% from 350% at Sep 08, anticipating a rough 2009. We have raised our FY09-10 EPS estimates on a lower tax rate going forward, lifting our target price to Rp3,350 from Rp3,250. Despite good 2008, 2009 might be less promising. We remain Neutral on the bank, mainly on the view that its current valuation premium has priced in upside potential thus far.