OCBC Bank - Maybank Research 2023-03-10: Great Eastern Has Hiked Earnings Volatility; Waiting For Clarity

OCBC Bank - Great Eastern Has Hiked Earnings Volatility; Waiting For Clarity

  • With risk-rewards fairly balanced, downgrade OCBC (SGX:O39) to HOLD with lower target price of S$13.58.
  • Tailwinds from China reopening, higher for longer NIMs and high levels of capital puts OCBC in a strong position. Nonetheless, dividend visibility is lower vs a quarter ago given changes to its dividend policy.
  • Read this at SGinvestors.io -

Tapering growth. Lower dividend predictability

  • Read this at SGinvestors.io -
  • On the other hand, there is potential for higher wealth management income to flow through from private banking customers looking to introduce more risk to their portfolios. However, timing remains clouded until we see a peak in rate hikes.
  • Separately, OCBC has changed their dividend policy from a progressively rising, absolute S$/share payout to a percentage payout. The earlier policy – similar to DBS (SGX:D05) – provided better visibility and indicated a yield floor, which is now absent. See OCBC's dividend history.

Great Eastern increases earnings volatility

  • Read more at SGinvestors.io.

Above is the excerpt from report by Maybank Research.
Clients of Maybank Securities may be the first to access the full report in PDF @ https://www.ketrade.com.sg/.

Thilan Wickramasinghe Maybank Research | https://www.maybank-ke.com.sg/ 2023-03-10

Previous report by Maybank:
2022-11-05 OCBC Bank - Stable Outlook.

Price targets by 5 other brokers at OCBC Target Prices.
Listing of research reports at OCBC Analyst Reports.

Relevant links:
OCBC Share Price History,
OCBC Announcements,
OCBC Dividends & Corporate Actions,
OCBC News Articles

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