CIMB's Rollercoaster Ride: Is It Time to Buy the Dip or Jump Ship?
After surging 50% over the past year, $CIMB (1023.MY)$ has entered a correction phase down over 10% since March.
Bottom-fish or exit? Before deciding, let's unpack CIMB's core fundamentals.
"Is now a good time to get on board?"
When we buy a stock, we are essentially investing in the company. Before answering this question, let's first take a look at the company's operations and profitability.
1）Net Interest Margin (NIM): The Bank's "Spread Game"
Unlike any other industry, one of the main sources of a bank's profit is the interest spread, which is the difference between the interest received on loans and the interest paid on deposits.
$CIMB (1023.MY)$'s NIM in 2024 was 2.21%. Although it declined in the fourth quarter due to deposit competition, it still increased slightly for the whole year. However, in 2025, it may be affected by the Singapore/Indonesia market, with a 5-basis-point downward risk. Maybank reported a 2.05% rate during the same period.
2）Loan Growth:
The more loans a bank makes, the higher its future interest income will be. CIMB's loan growth in 2024 was 4.8%, with consumer loans (+3%) and small & medium enterprise (SME) loans (+6.2%) being the main drivers, while corporate loans decreased slightly. The management expects the growth rate to accelerate to 5-7% in 2025.
3）Asset Quality:
Every bank faces uncollectible loans (bad debts). CIMB's total non-performing loan ratio (GIL) fell from 2.67% to 2.12%, while loan loss coverage (LLC) rose from 97% to 105%.
Translation: Fewer bad loans + bigger rainy-day funds = a healthier balance sheet. This buffers against future shocks.
4）Credit Costs:
This measures how much profit banks set aside for potential loan losses. $CIMB (1023.MY)$'s 2024 credit costs came in at 25 basis points (below management guidance), showing disciplined risk management.
By the way, these are the operational metrics of major banking stocks over the past year. Maybank stands out as the top performer, while $RHBBANK (1066.MY)$ offers the highest dividend yield and $CIMB (1023.MY)$ boasts the strongest net interest income. Use these key figures to identify your preferred banking investment.
"A 10% Loss, Should I Sell?"
Many investors must have noticed that we mentioned in the weekly fund flow that $CIMB (1023.MY)$ was once a major target for large-scale selling. Is it the same recently?
Fund Movements
According to data tracking by Bloomberg, there has actually been a return of funds. The latest change position (19 Mar 2025) shows Credit Agricole increased 8.34 million shares, BlackRock added 2.17 million stocks and Nomura bought extra 7.77 million shares.
Forward 30
On March 5, CIMB announced the Forward30 plan at the Investor Day.
Core Objectives: To rank in the top 25% of the industry in terms of ROE by 2030, and increase the proportion of non - interest income (NOII) to 33 - 34%.
Core Strategies & Action Plan
1) Lower Funding Costs: Boost CASA Ratio
Attract retail/non-retail deposits via cross-border fee-free remittances, aiming to lift Current Account Savings Account (CASA) ratio from 43% to 45% (higher CASA = more low-cost funding, enhancing NIM & profitability).
2) Revenue Diversification: Expand Non-Interest Income (NOII)
Deliver tailored financial solutions (risk management/treasury services/IB products) to corporates, targeting >65% non-loan revenue in wholesale banking (vs 60% currently).
3) Operational Efficiency: Optimize Cost Structure
Leverage process simplification+AI+data analytics to reduce cost-income ratio (CIR) from 46.7% to 40%, unlocking operational leverage.
4) Capital Strength: Fortify Resilience
Maintain Common Equity Tier 1 (CET-1) at 13-14%, commit to ≥55% dividend payout through 2027 (CET-1: core loss-absorbing capital, critical for stability).
Regional Strategy Breakdown
Singapore (ROE 19.9%): High-return engine driving growth
Indonesia: Shift to high-net-worth segments; monitor liquidity risks
Thailand: Drag-on-group ROE, transformation progress critical
The Wisdom of Investing in Batches
Consider the pyramid averaging method – a conservative but strategic approach.
Start with a small position (e.g., 30% of your intended investment). If the price drops 10%, add another 20%. If it falls another 10%, add 20% more.
Save the final 40% for when the price stabilizes. This avoids the risk of catching a falling knife, spreads your cost over time, and lowers your average purchase price.
Stop-loss rules:
If the price breaks key support levels and fear of further declines grows, trim 1/3 of your position. If fundamentals deteriorate (e.g., rising bad loans, shrinking margins), exit completely.
Profit-taking strategy:
Few investors sell at the absolute top. Instead, take profits in stages as the price rebounds to your target levels – lock in gains without chasing peaks.
The bigger picture
Investing isn’t about luck–it’s about discipline. Staggered entries/exits let you sleep easier.
Bank stocks thrive on "steady progress", but during market downturns, patience is key. Remember: short-term volatility is noise. Long-term value always comes back to fundamentals.
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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蓝鸟 : Let's first observe the situation, the news that will stimulate the stock price has not yet come out.
105172342 : Wait and see. More US tariffs news is coming soon. This will impact the stock market.
102320979 : when foreign funds buy, we can also buy on dips at the present moment. CIMB has been set a strong base by the previous CEO n the current CEO just have to ride on the same trajectory.
小刘五年挣100 w : This cannot rise.
Moomoo News MY OP 蓝鸟 :![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
Sounds like you're looking to buy in once there's an upward trend.
Moomoo News MY OP 102320979 : Yeah, CIMB has a solid background. Keep an eye on foreign capital flows and don't forget to check the weekly fund flow every Monday![[undefined]](https://static.moomoo.com/nnq/emoji/static/image/default/default-black.png?imageMogr2/thumbnail/36x36 "undefined")
Moomoo News MY OP 105172342 : Yeah, the macro changes in the U.S. have a big impact on the Malaysian market too~
103284602ing : It's still not cheap enough.