Nicolaos Oentung is recommending investors to take profits on recent rally as visibility on NPL remains poor. Inflow of new NPL has been rising sharply since 4Q08 and Nico thinks that we are still early in the NPL cycle.
NPL is on the rise. Inflow of NPL has been rising sharply since 4Q08. Indonesian banks have shown declining NPL ratio in the most recent quarter, however this masked the true NPL trend given the large write-offs. Hence after adding back the write-offs, we calculate the inflow of new NPL has in fact been rising.
Indo banks are going to report 1Q09 results soon and there are good chances for positive surprises. Maybe investors can wait until after 1Q09 results before taking some profits .
Key points from the report:
· Loans growth continues to decelerate, while NPL is on the uptrend.
· Feb 09 loans growth: +30% YoY, down from peak of +38% YoY in Oct 08.
· Indicative Mar 09 figures also show further slowdown to +27% YoY.
· 1Q09 earnings likely weak. We expect banks to post on average 5% YoY decline in net profit for 1Q09. NIM pressure should ease esp for Danamon (BDMN IJ), but loan growth will be tepid.
· We maintain cautious stance. Key issues remains while we have assumed worst case scenarios for NPL in our models, visibility remains poor.
· As a rough guide, trough to peak NPL lasts about 15 months in last cycle (05-06) with real GDP slowing to 5.0% vs. current six months with 3-4% GDP growth.
Tidak ada komentar:
Posting Komentar