\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 128 Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) )
On March 31, 2022, Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) issued the annual performance report for 2021.
Key investment points:
Revenue increased by 16.3% year-on-year, and net profit increased by 21.3% year-on-year: on the revenue side, net interest income increased by 12.2% year-on-year, and net fee income increased by 61% year-on-year. The cost income ratio decreased by 1.4 percentage points year-on-year.
The net interest margin rebounded in the fourth quarter on a month on month basis: the increase in the proportion of loans led to the rise of the yield of the whole interest bearing asset side, which in turn promoted the short-term stabilization and recovery of the net interest margin. Looking forward to the first half of 2022, the net interest margin is affected by the LPR reduction, and there is a certain downward pressure. However, in terms of deposits, due to the improvement of debt cost control efficiency, the cost of deposits may decline, and the overall downward range of net interest margin is expected to be limited.
The growth rate of net handling fee income increased significantly: the net handling fee income increased by 61% year-on-year in 2021, mainly due to the high growth of agency handling fee income and the superposition of the downward contribution of handling fee expenditure of settlement business.
Higher provisions provide good support for performance growth: the non-performing rate decreased to 0.81% at the end of 2021, a year-on-year decrease of 15bp. The generation rate of defects is also low. The provision coverage rate reached 531.82%, which remained high and had a strong risk offset ability. The current stable asset quality is superimposed with sufficient provisions, and the subsequent non-performing assets and provision pressure are less, forming a good support for the sustained growth of future performance.
Profit forecast and investment suggestions: the company’s performance increases rapidly, focuses on small and micro businesses, and widens the whole business scope through misplaced competition. The EPS forecast for 2022 / 23 is 0.98 yuan and 1.16 yuan, and the corresponding net assets per share are 7.85 yuan and 8.79 yuan respectively. According to the closing price of Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) a shares on March 30, 7.51 yuan, corresponding to 0.96 times and 0.85 times of Pb in 2022 and 2023 respectively, maintain the overweight rating.
Risk factors: affected by covid-19 epidemic, the global economic recovery was less than expected, resulting in sharp fluctuations in bank assets.
