- Net foreign buying for selected banking stocks. Based on the latest available data, selected banks saw increases in foreign shareholdings during the recent months.

- CIMB’s foreign shareholding in April 2014 rose for the first time in eleven months. CIMB’s foreign shareholding rose to 34.3% in April 2014, from 33.4% in March 2014. The recent peak was 42.7% in end-May 2013.

- Maybank’s foreign shareholding also increased in the past two months since the recent low in March 2014. Maybank’s foreign shareholding experienced a gradual rise to 21.88% as at 9 May 2014, from the recent low of 21.11% on 14 March 2014.

- RHB Cap also recorded an upturn in foreign shareholding in March-April 2014. RHB Capital (RHB Cap) also posted an increase in foreign shareholding, to 8.80% in April 2014 and 8.36% in March 2014, from recent low of 8.10% in February 2014.

- However, HLBB’s foreign shareholding continued to slip in March 2014. Hong Leong Bank’s (HLBB) foreign shareholding continued to decrease for the third consecutive quarter to 7.99% in March 2014, from 8.06% in December 2013.

- AFG’s foreign shareholding also continued to decline. AFG’s foreign shareholding also continued to decline to 31.3% in April 2014, from 32.5% in March 2014. This is the eleventh month of consecutive declines in AFG’s foreign shareholding, since the recent peak of 37.8% in May 2013.

- We maintain NEUTRAL on the sector. The latest data available indicates some level of increases in foreign shareholding for a few large-cap banking stocks (CIMB and Maybank) and one mid-cap bank (RHB Cap). However, foreign shareholding continued to decline for the small- to mid-cap stocks (AFG and HLBB). We remain NEUTRAL on the sector as we expect capital issues and earnings risks to be ongoing concerns for the banking sector. 

Source: AmeSecurities