The sector has remained resilient despite the headwinds. Initial concerns of
modification losses may also be unfounded. Although the sector could remain in consolidation mode in 3Q21, we view any weakness as an opportunity to accumulate as the vaccination rollout gains momentum. The sector’s solid capital and liquidity position act as effective shock absorbers, while valuations remain attractive at -1.5SD to historical mean P/B. Maintain OVERWEIGHT. CIMB is our top sector pick.