STOCKS NEWS THAILAND-Nomura cuts Bank of Ayudhya to 'neutral' on Q1 results

Nomura Equity Research downgraded Bank of Ayudhya Pcl to 'neutral' from 'buy' and lowered its price target to 36 baht from 39 after the bank reported weaker-than-expected quarterly earningsdue to slower growth in retail and SME loans.

Bank of Ayudhya shares were up 1.5 percent at 33.5 baht, with a year-to-date gain of 3.1 percent, underperforming the banking subindex's 10.8 percent rise.

Nomura said it cut earnings forecasts by 9 percent in 2013 and 12 percent in 2014, reflecting lower margins, higher costs and a higher provision structure.

"After improving significantly during 2012, our concern is that BAY's return on assets (ROA) is capped at 1.5 percent from 2013-15F after rising from 1 percent since 2011," it said.

For the bank's earnings statement, click 1114 (0414 GMT) (Reporting by Viparat Jantraprap in Bangkok; Editing by Anand Basu)

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