Banking is a critical sector in any country’s economy.

It is also a special business because it is highly leveraged

And with leverage, comes risk.

So Banking is very highly regulated and so far, its regulator, Bank Negara Malaysia, has done a pretty good job.

Bank Negara has a say in who gets to join the board of a bank, and who gets to be the CEO of a bank. They also have a say in how much liquidity a bank needs to maintain.

Imagine you going for an interview for a Bank CEO. You went through the board and after the board clears you, you need to get the approval from Bank Negara. If Bank Negara finds something fishy about you, that appointment will not come through.

In other words people who runs the bank in this country is the ‘Creme de la creme’ of the industry. They are the best of the best the country has to offer when it comes to banking and finance talent. They are also the honest bunch. This is very important because you cannot do business with crooks.

Owning a piece of the banking business means you are technically getting the best minds to manage your money too.

So to me, buying banking stock is an asymmetric set up. You make a consistent return with the downside capped.

Of course I am not saying the stock price will not tank. If US President decides to impose a 100% tariff on Malaysian exports, the stock price will be affected. But people would still need to pay their mortgage and their car loans regardless. The business will still be paying dividends.

I don’t think we can say the same thing about investing in DOGE.

And if you are a good Malaysian, rooting for the success of this country, then owning a piece of the banking sector means that you can make some money while supporting the growth of the country’s economy.

That to me is to do good while doing well.