Key investment points:
In December, Shenwan bank recorded a rise and fall of 0.28%, underperforming the Shanghai stock index by – 1.85% and the Shanghai and Shenzhen 300 index by – 1.96%. The monthly rise and fall ranked 23rd among Shenwan’s 28 first-class industries. As of December 31, Shenwan bank increased or decreased by – 4.58% during the year, ranking 20th among Shenwan’s 28 primary industries. Leading stocks in December: Bank Of Chengdu Co.Ltd(601838) (7.05%).
In December, the valuation of the banking sector fluctuated slightly. As of December 31, the overall price earnings ratio (historical TTM) of the banking sector was 4.97x, an increase of 0.07x compared with the end of last month and a discount of 74.77% compared with the valuation of a shares; The overall price to book ratio of the sector was 0.59x, a slight increase of 0.01x compared with the end of last month, with a discount of 70.55% compared with the valuation of a shares.
In terms of policy, the reserve requirements and interest rates were reduced, and the liquidity was reasonable and abundant. As of December 31, the maturity yield of AAA 1m / 3m / 6m interbank certificates of deposit was 2.47%, 2.39% and 2.45% respectively; The maturity yield of AA 1m / 3m / 6m interbank certificates of deposit was 2.63%, 2.57% and 2.59% respectively. As of December 31, the interest margin of AAA 3m-1m interbank certificates of deposit was – 8bp; The interest margin of AA grade 3m-1m interbank certificate of deposit is – 6BP; The interest margin between AA and AAA 3M interbank certificates of deposit is 18bp. Affected by the reduction of reserve requirements and interest rates, interest rates are upside down. The expected annual yield of financial products in each period decreased year-on-year. Compared with the same period in 2020, except that the expected rate of return of financial products in 4 and 6 months increased slightly by 4bp and 3bp, the rate of return of other term financial products decreased. The interbank offered rate was basically stable. In December, the weighted average interest rate of interbank lending was 2.02%, down 1bp month on month, an increase of 72bp year-on-year.
Investment suggestions: at the beginning of the new year, we should leave the old and welcome the new, end the transitional period of new regulations on asset management, and implement new policies such as continuous conversion of direct tools. The policy emphasizes steady growth, the economic and industrial fundamentals are expected to remain stable, the business development pays attention to customer stickiness and strategic focus, and the differentiation between banks is increased. At present, the valuation of the banking sector is at a low level. It is recommended to grasp the high-quality banks with stable business operation, good asset quality and effective support for local economic development: China Merchants Bank Co.Ltd(600036) , Bank Of Ningbo Co.Ltd(002142) , Ping An Bank Co.Ltd(000001) , Postal Savings Bank Of China Co.Ltd(601658) , Bank Of Jiangsu Co.Ltd(600919) , Bank Of Nanjing Co.Ltd(601009) , Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) . Maintain the rating of “synchronous market” in the industry.
Risk tip: economic growth is less than expected; Policy adjustment exceeded expectations; Asset quality declined.
