Notwithstanding the current trade war climate, CIMB Research does not believe that the price-to-book valuations of banking stocks will fall to the COVID-19 lows of 0.3 to 0.5x Book Value. During the pandemic lockdown, 70% to 80% of loans were placed under moratorium in the initial phase, before dropping to 30% on an opt-in basis towards the end of 2020. However in the current scenario, loan relief assistance can be more targeted towards exporters and affected companies in the supply chain, making the current uncertainty less widespread as compared to the pandemic days.

Source: TheStar