the annual report disclosed on March 25, China Everbright Bank Company Limited Co.Ltd(601818) 3 shows that in 2021, the bank achieved operating revenue of 153366 billion yuan, an increase of 7.40% year-on-year; The net profit was 43.639 billion yuan, a year-on-year increase of 15.06%. The board of directors of the bank proposed to pay a cash dividend of 2.01 yuan (before tax) for every 10 shares, with a total dividend of 10.86 billion yuan.
“Over the past year, China Everbright Bank Company Limited Co.Ltd(601818) consolidated the role of corporate finance as a ‘ballast’ in the transformation of wealth management, and gave play to the role of retail finance as a ‘new force’ in the transformation of wealth management.” China Everbright Bank Company Limited Co.Ltd(601818) president wrote in his speech. At the end of last year, the bank’s effective corporate customers increased by 27.35%, and the total customer financing (FPA) exceeded 4.27 trillion yuan, which is the first time the bank has used this index in its annual report; At the same time, the bank’s retail asset management scale (AUM) has also reached a new level of 2 trillion in this year.
However, on the asset liability side, China Everbright Bank Company Limited Co.Ltd(601818) in the fourth quarter, the single quarter assets deviated from the growth rate of loans and advances, the growth of customer deposits was also weak, the pressure drop of debt cost was difficult, and the cost rate of customer deposits and the average cost rate of interest bearing liabilities rebounded compared with the data in the middle of last year.
debt cost is hard to reduce
annual report shows that by the end of 2021, China Everbright Bank Company Limited Co.Ltd(601818) assets totaled 5.9 trillion yuan, an increase of 9.95% over the end of the previous year; The total principal of loans and advances was 3.31 trillion yuan, an increase of 9.90% over the end of the previous year; The balance of deposits was 3.68 trillion yuan, an increase of 5.61% over the end of the previous year
Chinese reporters from securities companies noted that quarterly, China Everbright Bank Company Limited Co.Ltd(601818) in the third quarter, there was a sign of “table contraction”, with assets decreasing by 0.08 trillion yuan month on month and liabilities decreasing by 0.1 trillion yuan month on month; On this basis, the bank had an obvious “table expansion” in the fourth quarter, with assets increasing by 0.21 trillion yuan month on month, the highest in nearly seven quarters, but the bank’s loans and advances increased by only 0.02 trillion yuan month on month in the same period.
On the liability side, China Everbright Bank Company Limited Co.Ltd(601818) also faces the problems of weak growth of customers’ deposits and difficulty in reducing the cost of liabilities. By the end of 2021, the deposit balance of China Everbright Bank Company Limited Co.Ltd(601818) customers was 3.68 trillion yuan, an increase of about 3% over the end of the previous year, and the proportion in the total liabilities decreased by 2.99 percentage points over the end of the previous year; Meanwhile, the bank’s cash inflow from customers’ deposits decreased by 269 billion yuan last year, resulting in a year-on-year decrease of about 38% in cash inflow from the bank’s operating activities.
In terms of debt cost, in China Everbright Bank Company Limited Co.Ltd(601818) 2021, the average cost rate of interest paying debt was 2.35%, which decreased by 0.04 percentage points compared with the end of the previous year, but increased by 0.01 percentage points compared with the data in the first half of last year; Among them, the average cost rate of customer deposits was 2.22%, a decrease of 0.08 percentage points compared with the end of the previous year, but an increase of 0.02 percentage points compared with the data in the first half of last year.
under the current market environment with downward asset side interest rate, the relative rigidity of debt cost also leads to the continuous narrowing of net interest margin, a profit index of China Everbright Bank Company Limited Co.Ltd(601818) for two consecutive years. In 2021, the net interest margin of the bank was 2.16%, a decrease of 0.13 percentage points over the previous year
At the performance press conference of China Daily last year, Fu Wanjun, President of China Everbright Bank Company Limited Co.Ltd(601818) bank, also admitted that the downward trend of the bank’s debt cost is more prominent in the industry, but the absolute value of debt cost is still high. He also said that the bank had incorporated the “double excellence in volume and price” into the operation evaluation system, and controlled the cost of liabilities by expanding the flow of retail customers and corporate customers and increasing the precipitation of low-cost funds.
In addition, in terms of asset quality that has attracted much attention in the industry, China Everbright Bank Company Limited Co.Ltd(601818) still maintains a good trend of “double decline” in volume and rate. Among them, by the end of 2021, the bank’s non-performing loan balance was 41.366 billion yuan, 300 million yuan less than that at the end of the previous year; The non-performing loan ratio was 1.25%, down 0.13 percentage points from the end of the previous year; The provision coverage rate was 187.02%, an increase of 4.31 percentage points over the end of the previous year.
first use FPA index
Over the past year, China Everbright Bank Company Limited Co.Ltd(601818) has made “brilliant achievements” in expanding corporate customers, and used the indicator of total customer financing (FPA) for the first time in the annual report.
FPA index first appeared in China Merchants Bank Co.Ltd(600036) 2020 interim report, and then Industrial Bank Co.Ltd(601166) also disclosed this index for the first time in 2020 annual report China Merchants Bank Co.Ltd(600036) president Tian Huiyu pointed out at that time that the bank’s corporate business was facing four shocks: interest rate marketization, financing disintermediation, Internet Finance and economic downturn. The implementation of FPA index in the industry was one of the measures to deal with these shocks.
It is reported that FPA is a concept of comprehensive finance. The significance of this index is that “when judging the service ability of customer management team to customers in internal assessment, it is not simply to see how much traditional on balance sheet loans have been made, but how much they have helped customers finance as a whole”.
This year, China Everbright Bank Company Limited Co.Ltd(601818) became the third stock bank to disclose FPA indicators in its annual report. Over the past year, the bank continued to accelerate the strategic transformation of “commercial bank + investment bank + asset management + transaction”, took FPA as the transformation engine, expanded the total amount of customer financing, optimized the financing structure, and created three “1 / 3” target structures of traditional credit, bond financing and non loan and non debt business in FPA.
For example, support the financing needs of a large group of customers through a variety of financial instruments, issue ultra short-term financing bonds and senior sustainable bonds for them, and successfully implement directional asset-backed notes (carbon neutral bonds) with subsidiaries of Everbright Group, so as to realize the group’s collaborative support for innovative business development and enhance customer stickiness.
According to the annual report, in 2021, China Everbright Bank Company Limited Co.Ltd(601818) the bank’s total FPA exceeded 4.27 trillion yuan, an increase of more than 150 billion yuan over the end of the previous year; The total number of effective corporate customers of the bank was 414000, with an increase rate of 27.35%, and the increment of effective customers accounted for 89%.
In terms of small and Micro customers, China Everbright Bank Company Limited Co.Ltd(601818) disclosed that in 2021, the bank implemented phased deferred repayment of principal of 14.895 billion yuan, involving 22000 households, and phased deferred payment of interest of 716 million yuan, involving 19500 households.
By the end of last year, according to the latest regulatory regulations, the balance of China Everbright Bank Company Limited Co.Ltd(601818) Pratt & Whitney loans after discounting was 237001 billion yuan, an increase of 26.72% over the end of last year, higher than the average growth rate of various loans; 392100 customers, an increase of 18900 over the end of the previous year; The weighted average interest rate of new loans was 4.90%, a year-on-year decrease of 36bps; The defect rate was 0.68%.
In addition, China Everbright Bank Company Limited Co.Ltd(601818) last year, it also increased investment in science and technology and the introduction of scientific and technological talents. The proportion of scientific and technological personnel exceeded 5% for the first time, and explored the mode of scientific and technological deployment in corporate finance, retail finance, digital finance and other departments.
wealth management achievements
At the beginning of 2021, in the face of intensified competition in the banking industry, China Everbright Bank Company Limited Co.Ltd(601818) focusing on the strategy of “building a first-class wealth management bank”, further proposed a two-year “leap forward plan” for “20212022”, which aims to complete five new leaps in profitability, business scale, wealth management, customer base and risk control within these two years.
At the end of the first year of the “leapfrog plan”, retail business has become the main driver of China Everbright Bank Company Limited Co.Ltd(601818) revenue growth.
According to the annual report, last year, China Everbright Bank Company Limited Co.Ltd(601818) retail business revenue reached 63.346 billion yuan, up 7.98% year-on-year, accounting for 41.47% of the bank’s operating revenue. Among them, the retail net interest income was 44.746 billion yuan, a year-on-year increase of 6.07%, accounting for 39.90% of the bank’s net interest income; The net retail non interest income was 18.6 billion yuan, a year-on-year increase of 12.86%, accounting for 45.82% of the bank’s net non interest income.
In terms of expanding customers, by the end of 2021, China Everbright Bank Company Limited Co.Ltd(601818) retail customers (including debit card and credit card customers) had exceeded 140 million, and medium and high-end customers with average monthly and daily assets of 500000 yuan or more had increased by 11.29% over the end of the previous year; The cumulative users of mobile banking, sunshine life and cloud payment apps were close to 200 million, an increase of 50.34% over the end of the previous year, including 511584 million monthly live users (MAU), an increase of 32.97% over the end of the previous year; The total assets of retail customers under management (AUM) was 2.12 trillion yuan, an increase of 10.68% over the end of the previous year.
At the same time, the bank’s private customers exceeded 50000, an increase of 24.70% over the end of the previous year, and the new customers were 1.25 times the increase in the same period last year; The total assets under management was 501128 billion yuan, an increase of 14.63% over the end of the previous year.
In terms of wealth management business, China Everbright Bank Company Limited Co.Ltd(601818) disclosed that in 2021, the bank realized a net income of 7.944 billion yuan from personal wealth management fees, a year-on-year increase of 23.09%; Among them, the agency fund income increased by 37.92% year-on-year, and the agency trust income increased by 49.41% year-on-year.
It is worth mentioning that the China Everbright Bank Company Limited Co.Ltd(601818) annual report disclosed that Everbright wealth management, a financial subsidiary of the bank, realized a net profit of 1.586 billion yuan in 2021, and the total scale of assets under management exceeded 1 trillion yuan at the end of the year.
