Malayan Banking Berhad (Maybank) is marketing a new US dollar-denominated 3-year floating rate note (FRN) targeted at institutional investors under Regulation S, with initial price guidance (IPT) set at SOFR +90 basis points (bp).
CreditSights analysts see the note’s fair value (FV) at SOFR +60 bp, implying potential tightening of around 30 bp from IPT, reflecting investor confidence in Malaysia’s largest banking group and its strong credit fundamentals.
Maybank’s latest offering marks a shift from its previous benchmark-sized zero-coupon Formosa bonds, expanding its US dollar funding profile. While there are few direct comparables in Malaysia, regional peers such as Korea Exchange Bank (KEBHNB), Bank of China (BCHINA), and China Construction Bank (CCB) have recently issued 3-year FRNs trading between Z+45 bp and Z+58 bp, according to CreditSights.
The analysts note that Maybank’s fundamentals are on par or stronger than Korean peer KEBHNB, with higher return on equity (11.5% vs. ~11%), stronger capital buffers (CET1: 14.7% vs. 13.3%), and better liquidity ratios (LCR: 138%). Asset quality remains sound, with credit costs at 24 basis points and a gross non-performing asset ratio of 1.3%, within the bank’s five-quarter range.
“We place Maybank’s fair value about 5 bp behind KEBHNB, given Malaysia’s weaker sovereign rating,” said CreditSights analysts Lim Ze Hao and Pramod Shenoi, who added that Maybank remains a strong credit as a domestic systemically important bank (D-SIB) with assured state support.
In 1H25, Maybank posted a 4% year-on-year increase in net profit to RM5.2 billion, driven by higher trading and investment income and lower provisions. Return on equity rose to 11.5%, supported by stable margins and steady loan growth in Malaysia (+6.8%) and Singapore (+4.3%).
Deposits grew 6.1% year-on-year, easing the loan-to-deposit ratio to 90.2%, while the total capital adequacy ratio (CAR) stood at 17.9%.
CreditSights views Maybank as well-positioned in the regional banking landscape, supported by its diversified footprint, strong balance sheet, and solid government links, though variability in its Indonesian and insurance operations remains a watch point.
