\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 658 Postal Savings Bank Of China Co.Ltd(601658) )
Matters:
Postal Savings Bank Of China Co.Ltd(601658) released the annual report of 2021. In 2021, the annual operating revenue was 318.8 billion yuan, with a year-on-year increase of 11.4%, and the net profit attributable to the parent company was 76.2 billion yuan, with a year-on-year increase of 18.7% and roe11.5% 9%, up 0.02pct from last year. At the end of the year, the total assets were 12.59 trillion yuan, an increase of 10.9% over the end of the previous year. The profit distribution plan of the company in 2021 is: cash dividend of 2.474 yuan (including tax) for every 10 ordinary shares, with a dividend rate of 30.0%.
Ping An View:
Profits maintained rapid growth and the middle income performance was strong In Postal Savings Bank Of China Co.Ltd(601658) 21, the growth rate of net profit attributable to the parent company was 18.7% (vs22.1%, 21q3), which was lower than that in the third quarter, but still maintained a rapid level, which was better than other comparable banks. The company’s annual revenue increased by 11.4%, 1.2 percentage points higher than that in the first three quarters, of which the net interest income increased by 6.3%, the handling fee income increased by 33.4%, and other non interest income increased by 68%. The rapid growth of non interest income is the main factor supporting the increase of the company’s revenue growth. By the end of the 21st century, postal savings accounted for 7% of the total revenue. Although it was still lower than the benchmark peers, the improvement trend was obvious. Thanks to the continuous development of retail, the income related to wealth management increased strongly. In the 21st year, the agency business, financial management and custody business increased by 89%, 23% and 31% respectively, becoming the mainstay supporting the growth of the middle revenue. Considering the strong personal customer base of postal savings, the number of personal customers reached 637 million by the end of 21, we continue to be optimistic about the continuous release of the company’s retail potential.
The interest rate spread declined slightly, and credit continued to tilt to retail. The net interest margin of the company for the whole year of 21 years was 2.36%. We calculated the net interest margin of the company in a single quarter in the fourth quarter according to the balance at the end of the initial period of the period, which was 2.24% and narrowed by 4bp quarter on quarter. We believe that the narrowing of interest margin is mainly affected by the decline of loan pricing. The annual loan yield of the company is 4.68%, which continues to decline compared with the yield level of 4.72% in the first half of the year, which is consistent with the industry trend. The deposit cost of the company’s liability side is at a low level in the industry, and the annual deposit interest rate is 1.63%, with limited room for further decline. Looking forward to 22 years, considering that there is little room for improvement in asset end pricing in the short term, it is expected that the overall interest margin will still bear some pressure. From the perspective of the company’s negative asset performance, the annual asset scale increased by 11% and the overall expansion was stable, including the loan growth of 13%. The structure continued to tilt towards retail. The proportion of individual loans reached 58.2% at the end of the year, which continued to increase by 0.7 percentage points compared with the end of the half year.
The quality of assets is stable, and the provision is better than that of peers Postal Savings Bank Of China Co.Ltd(601658) 21 at the end of the year, the non-performing rate was 0.82%, which was flat on a quarter on quarter basis. We estimated that the company’s single quarter annualized non-performing rate in the fourth quarter was 0.60%, and the absolute level was still at the low level of the industry. From the perspective of forward-looking indicators, the company’s attention rate decreased by 1bp to 0.47% compared with the end of the half year, and the pressure on asset quality in the future can be controlled. The company’s provision coverage and loan allocation ratio in the fourth quarter decreased by 4pct / 4bp to 419% / 3.43% month on month, which continues to be better than the benchmark peers, and there is still room for the release of provisions in the future.
Investment suggestion: the transformation of new retail continues to advance, and we are optimistic about the valuation repair Postal Savings Bank Of China Co.Ltd(601658) as the only large state-owned bank positioning as a retail bank, relying on the “self support + agency” model, the number of leading outlets and the location advantages in the county and the central and western regions, Postal Savings Bank Of China Co.Ltd(601658) has a solid debt side advantage and a solid customer base. At present, the company continues to adhere to retail leading and wholesale coordination, promote the quality improvement and upgrading of “new retail”, accelerate the development of “light” and maintain strong growth in medium income. Looking forward to 22 years, considering the disturbance of the economic downturn on the quality of bank assets, we slightly reduced the company’s EPS from 2022 to 2023 to 0.96/1.09 yuan / share (the original forecast value was 0.97/1.11 yuan / share respectively), and added a new 24-year EPS forecast of 1.25 yuan / share, corresponding to the profit growth rate of 22 / 23 / 24 to 15.9% / 14.4% / 14.4% (the original forecast value of 22 / 23 was 14.3% / 14.2% respectively). At present, the company’s share price corresponds to 0.64x/0.58x/0.52x Pb in 22, 23 and 24 years respectively. Considering the company’s solid customer base on the liability side, the potential improvement space on the asset side and the asset quality performance of leading peers, we maintain the company’s “strongly recommended” rating.
Risk tips: 1) the economic downturn leads to higher than expected pressure on the quality of industrial assets. 2) The decline in interest rates led to a narrower than expected industry interest margin. 3) The increase of cash flow pressure of real estate enterprises leads to the rise of credit risk.
