UBS: Lowers target price of BANK OF E ASIA (00023) to 13.1 Hong Kong dollars, maintains "neutral" rating.
UBS has lowered East Asia Bank's target price-to-book ratio for 2026 from 0.4 times to 0.33 times, reflecting the possibility that high and sustained credit costs may limit the short-term valuation upside. It is also expected that moderate profit growth should support an increase in the mid-term dividend per share, even if the payout ratio remains unchanged.
UBS released a research report stating that due to BANK OF E ASIA (00023) still being exposed to risks in Mainland China and Hong Kong commercial real estate, it is expected that high credit costs will continue in 2026-2027. The target price has been lowered from 14.5 Hong Kong dollars to 13.1 Hong Kong dollars, with a maintained "neutral" rating. UBS has lowered the target market-to-book ratio for BANK OF E ASIA in 2026 from 0.4 to 0.33 to reflect the possibility that high credit costs may limit short-term valuation upside. Additionally, it is expected that even if the dividend payout ratio remains unchanged, moderate earnings growth should support an increase in dividend per share in the medium term.
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