PBBank- earning growth slowed down by higher personnel cost

Result Update
For QE31/3/2013, PBBank's net profit dropped 2.4% q-o-q but increased 2.9% y-o-y to RM968 million while revenue increased 1% q-o-q or 9% y-o-y to RM3.673 billion. Net profit dropped slightly q-o-q due to higher personnel costs and lower other operating income.


Table: PBBank's last 8 quarterly results

From the chart below, we can see that PBBank's profit margin has been sliding for the past 2 years. The lower profit margin has capped the group's bottom-line during the period.


Chart 1: PBBank's last 29 quarterly results

Valuation

PBBank (closed at RM16.32 yesterday) is now trading at a PE of 14.7 times (based on last 4 quarters' EPS of 111 sen). At this PE multiple, PBBank is deemed reasonably priced, with potential to command a PE of 16-17 times.

Technical Outlook

PBBank is still in an uptrend..


Chart 2: PBBank's monthly chart as at April 23, 2013 (Source: quickcharts)

Conclusion

Based on good financial performance, reasonable valuation & still-positive technical outlook, PBBank is still a good stock for long-term investment.

Note: 
In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, PBBank