\u3000\u3 China Vanke Co.Ltd(000002) 839 Jiangsu Zhangjiagang Rural Commercial Bank Co.Ltd(002839) )
Core view
The performance in 2021 is in line with expectations and maintains rapid growth. The annual revenue in 2021 was 4.62 billion yuan, a year-on-year increase of 10.1%, a slight decrease of 0.7 percentage points compared with the first three quarters, mainly due to other non interest income volatility factors; The annual PPOP increased by 9.0% year-on-year, down 1.1 percentage points from the first three quarters; The annual net profit attributable to the parent company was 1.3 billion yuan, with a year-on-year increase of 30.3%. The annual net profit attributable to the parent company increased by 16.9% on average in two years, up 1.5 percentage points from the first three quarters. The growth rate of net profit attributable to the parent company was significantly faster than that of income, mainly benefiting from the obvious improvement of asset quality. 2021 weighted roe11 1%, up 1.9 percentage points year-on-year.
The scale of assets maintained rapid growth. In 2021, the total assets increased by 14.4% year-on-year to 164.6 billion yuan, slightly lower than the previous period, but still significantly higher than the industry average. Among them, deposits increased by 13.5% year-on-year to 124.7 billion yuan, and loans increased by 17.6% year-on-year to 99.8 billion yuan; At the end of the year, the core tier 1 capital adequacy ratio was 9.82%. At present, the company still has 2.5 billion yuan of convertible bonds not converted into shares.
Further increase investment in small and medium-sized enterprises. In 2021, the company further increased its investment in small and micro enterprises. The balance of loans for small and micro enterprises of the parent company was 63.8 billion yuan, an increase of 20.6% year-on-year, accounting for 66% of the total loans; Among them, personal operating loans were 26.3 billion yuan, a year-on-year increase of 29.6%.
The net interest margin decreased significantly year-on-year and bottomed month on month. The company’s annual average daily net interest margin was 2.43%, a year-on-year decrease of 31bps. From the perspective of single quarter net interest margin, the net interest margin in recent quarters is basically about 2.44%, with little change. Among them, the annual loan yield decreased by 19bps year-on-year, and the deposit interest payment rate increased by 14bps. Looking forward to 2022, it is expected that with the completion of loan repricing and the constraints of self-discipline pricing mechanism on deposit costs, the pressure on the decline of net interest margin will be reduced, which will promote the recovery of the growth rate of net interest income.
The quality of assets was significantly improved, and the provision coverage rate was as high as 475%. The estimated non-performing rate in 2021 is 0.44%, with a year-on-year decrease of 148bps, which is significantly improved. Benefiting from the slowdown of non-performing marginal production and the year-on-year decrease of loan impairment loss, the provision coverage rate at the end of the year still increased significantly, reaching 475%, an increase of 23 percentage points compared with the end of the third quarter and 167 percentage points compared with the beginning of the year. In addition, the non-performing rate of the company at the end of the year was 0.94%, which remained stable; The attention rate was 1.61%, down 4bps month on month.
Investment suggestion: we slightly adjust the profit forecast according to the latest LPR adjustment and other factors. It is estimated that the net profit attributable to the parent company will be RMB 1.535/17.952083 billion from 2022 to 2024, with a year-on-year growth rate of 17.7/16.9/16.1%; Diluted EPS is 0.85/0.99/1.15 yuan; The current share price corresponds to PE of 7.1/6.0/5.2x and Pb of 0.79/0.62/0.65x, maintaining the “overweight” rating.
Risk tip: the weakening macroeconomic situation may have an adverse impact on the quality of bank assets.
