Investment summary:
Talk every Monday: Comments on the 2021 annual report of listed state-owned banks
As of this week, six A-share state-owned banks have disclosed their annual reports for 2021. This week, they mainly analyzed six listed state-owned banks.
The growth rate of net profit attributable to parent decreased month on month
In 2021, the revenue growth rate of the four banks was higher than that of 21q3. The differentiation of individual stocks is large. Specifically, the year-on-year growth rate of Postal Savings Bank Of China Co.Ltd(601658) revenue ranks first, reaching 11.4%, with the growth rate increasing by 1.2% month on month. The growth rate of Bank Of Communications Co.Ltd(601328) , Bank Of China Limited(601988) and Agricultural Bank Of China Limited(601288) revenue increases month on month, while the growth rate of Industrial And Commercial Bank Of China Limited(601398) and China Construction Bank Corporation(601939) revenue decreases month on month. Only two listed state-owned banks increased their net profit attributable to their parent in 2021 compared with 21q3. The differentiation of individual stocks is relatively large. Specifically, the net profit of Postal Savings Bank Of China Co.Ltd(601658) parent company increased rapidly, reaching 18.6%. Only the net profit of Bank Of China Limited(601988) and Industrial And Commercial Bank Of China Limited(601398) parent company increased slightly month on month, and the net profit growth of the other four companies decreased month on month.
We attribute the performance of six listed state-owned banks:
The year-on-year growth of net profit attributable to the parent company was mainly driven by the provision for asset impairment, of which China Construction Bank Corporation(601939) , Postal Savings Bank Of China Co.Ltd(601658) and Bank Of China Limited(601988) asset impairment provision contributed 15.9%, 14.8% and 12.3% to the net profit attributable to the parent company respectively, and Bank Of Communications Co.Ltd(601328) asset impairment provision contributed the least to the net profit attributable to the parent company, which was 2%.
The net interest margin of the six listed banks decreased year-on-year, and the contribution of the net interest margin to the net profit attributable to the parent company was negative. Among them, the net interest margin of transportation decreased by only 1bp year-on-year, and the net interest margin factor only dragged down the net profit attributable to the parent company by – 0.4%, mainly because the cost ratio of Bank Of Communications Co.Ltd(601328) interest bearing liabilities was the highest among the six banks. Under the background of reducing the cost of liabilities, the cost ratio of Bank Of Communications Co.Ltd(601328) interest bearing liabilities decreased significantly.
The growth rate of loan scale and deposit scale of six banks in 2021 was higher than that in 21q3. Benefiting from the development of infrastructure, it is expected that the credit of state-owned banks will continue to increase year-on-year in 2022.
Asset quality analysis: provision has room to release profits
Asset quality continued to improve. From the perspective of non-performing loan ratio and provision coverage ratio, except Bank Of China Limited(601988) , the non-performing loan ratio of the other five listed state-owned banks decreased month on month. Except for Bank Of China Limited(601988) and Postal Savings Bank Of China Co.Ltd(601658) , the provision coverage of the other four listed banks rebounded month on month, indicating that the asset quality has improved and the provision has been more consolidated. From the perspective of the leading indicator of non-performing loans focusing on the loan ratio, only Industrial And Commercial Bank Of China Limited(601398) focusing on the loan ratio increased slightly, indicating that there are still some potential risks in its asset quality.
Provision has room to release profits. From the perspective of provision, the provision of the six banks has driven the positive growth of performance. The recent policies continue to release the tone of maintaining stability, coupled with the marginal fine-tuning of real estate policies, the subsequent banking business environment may continue to improve, the potential risk of asset quality will decline, and the provision has the space to release profits.
Investment strategy: from the disclosed annual reports of listed state-owned banks, the quality of bank assets continues to improve. Subsequently, with the gradual implementation of policies, the expectation of loose real estate policies gradually heats up, the expectation of steady economic growth is strengthened, and the quality of bank assets is expected to continue to improve. Infrastructure investment is the core driving factor of this steady growth. Benefiting from this, it is expected that the credit supply of state-owned banks will continue to increase year-on-year. It is suggested to pay attention to state-owned banks with excellent fundamentals, such as Postal Savings Bank Of China Co.Ltd(601658) and China Construction Bank Corporation(601939) .
Risk warning: policy risk; The risk of macroeconomic recovery falling short of expectations; Covid-19 is at risk of continued deterioration.
