- We maintain HOLD on Malayan Banking Bhd (Maybank) with an unchanged fair value of RM9.40/share. This is based on an ROE of 12.6% for FY15F, leading to an unchanged fair P/BV of 1.6x.

- Maybank has announced that the issue price of the new Maybank shares to be issued pursuant to the 10th DRP applicable to the Final Cash Dividend has been fixed on 10 April 2015 (Price-Fixing Date) at RM8.70 per new Maybank share.

- The issue price is based on the five-day volume weighted average market price (VWAMP) of RM9.51 per Maybank share up to and including 9 April 2015, being the last trading day prior to the Price-Fixing Date for the issue price of new Maybank shares after a dividend adjustment of RM0.33 to the five-day VWAMP (Ex-Dividend VWAMP).

- There was also a further discount of RM0.48 which is approximately 5.23% to the Ex-Dividend VWAMP of RM9.18.

- This is in relation to its final tax-exempt dividend of 33 sen for FY14.

- The electable portion of DRP has been announced earlier at 23 sen and the remaining amount of 10 sen to be paid in cash.

- Assuming an 85% subscription rate, we estimate the dilution to ROE at 2.3% (see table in following page).

- The ex-date is 23 April 2015.

- The entitlement date is 27 April 2015.

- The payment date is 26 May 2015.

- The new shares is expected to be listed on 27 May 2015.

- We maintain HOLD.

Source: AmeSecurities Research - 13 Apr 2015