The performance express of listed banks disclosed successively has shown that the overall “good news” of industry performance can be expected in advance. Many brokerage analysts expect that the enhanced profitability and improved asset quality will provide strong support for the valuation of listed banks. In the context of broad credit force and the catalysis of the annual report market, bank stocks are expected to achieve valuation repair.
performance growth is deterministic
The average annual profit of the two banks has increased by more than Shanghai Pudong Development Bank Co.Ltd(600000) and in 20201 and has been improved by 20 and 36 in 20201 .
According to the annual report, in 2021, Ping An Bank Co.Ltd(000001) achieved a net profit attributable to the bank’s shareholders of 36.336 billion yuan, an increase of 25.6% year-on-year. By the end of December 2021, Ping An Bank Co.Ltd(000001) NPL ratio was 1.02%, down 0.16 percentage points from the beginning of the year; The provision coverage rate was 288.42%, an increase of 87.02 percentage points over the beginning of the year.
In 2021, China Merchants Bank Co.Ltd(600036) realized a net profit attributable to the bank’s shareholders of 119922 billion yuan, exceeding 100 billion yuan for the first time, with a year-on-year increase of 23.20%; The non-performing loan ratio was 0.91%, down 0.16 percentage points from the end of the previous year; The provision coverage rate was 483.87%, an increase of 46.19 percentage points over the end of the previous year.
According to the performance express, in addition to Ping An Bank Co.Ltd(000001) and China Merchants Bank Co.Ltd(600036) and China Merchants Bank Co.Ltd(600036) , the net profit of 11 banks increased by more than 20% in 2021, and that of 7 banks increased by more than 10% in 2021.
Everbright Securities Company Limited(601788) Wang Yifeng, chief analyst of financial industry, said that the disclosed performance letters of listed banks in 2021 were brilliant, showing three characteristics on the whole: first, the revenue growth was basically stable, and the profit growth was higher than that in the third quarter of 2021; Second, the asset quality continued to improve, and the non-performing rate decreased slightly or remained flat quarter on quarter; Third, the provision coverage rate increased quarter on quarter, and the risk offset ability was enhanced.
valuation and repairable period
Recently, the A-share market fluctuated greatly, and the banking sector fluctuated and adjusted accordingly. Data show that as of March 21, the China Citic Bank Corporation Limited(601998) index has fallen by 2.68% this year, with a price to book ratio of 0.62 times.
Many brokerage analysts expect that under the background of wide credit force and the catalysis of the annual report market, the valuation of bank stocks can be repaired Northeast Securities Co.Ltd(000686) analyst Chen Yulu said that in the early stage, affected by the fluctuation of capital, some leading bank stocks oversold significantly. It is suggested to pay attention to the rebound opportunity.
Chen Yulu stressed that banks are optimistic about the performance level of credit and supplement the price with quantity; In terms of asset quality, wide credit will lead to asset quality optimization and reverse the market’s concerns about bank asset quality; Superimposed on the good performance of many banks, we are optimistic about the valuation repair of the banking sector.
“At present, the valuation of the banking sector is at a historical low. With the continuous development of broad credit, the valuation repair of the banking sector is worth looking forward to.” Dongxing Securities Corporation Limited(601198) Lin Jinlu believes that from the perspective of banking fundamentals, the performance is deterministic, and the accelerated transformation of wealth management business will further contribute to new profit growth points.
