Investment summary:
Talk every Monday: Comments on the 2021 annual report of listed joint-stock banks
As of this week, a total of seven A-share banks have disclosed their annual reports for 2021. This week, they mainly analyzed seven listed joint-stock banks.
The growth rate of net profit attributable to the parent company increased significantly year-on-year
The total operating revenue of the nine listed joint-stock banks in 2021 was 1.59 trillion yuan, a year-on-year increase of 5.34%. Revenue growth increased quarter by quarter, with a month on month increase of 0.28% and a year-on-year decrease of 1.54%. The net profit attributable to the parent company of the nine listed joint-stock banks in 2021 totaled 461.55 billion yuan, a year-on-year increase of 13.71%, a month on month increase of 0.21% and a year-on-year increase of 17.03%.
We attributed the performance of seven listed joint-stock banks. The year-on-year growth of net profit attributable to the parent was mainly driven by the provision for asset impairment, followed by the expansion of the scale of interest bearing assets and the increase of other non interest income:
The year-on-year growth of net profit attributable to the parent company was mainly driven by the provision for asset impairment. Among them, Industrial Bank Co.Ltd(601166) , China Minsheng Banking Corp.Ltd(600016) and China Citic Bank Corporation Limited(601998) the provision for asset impairment contributed 22.8%, 21.8% and 21% to the net profit attributable to the parent company respectively, and China Zheshang Bank Co.Ltd(601916) the provision for asset impairment contributed the least to the net profit attributable to the parent company, dragging down the growth of net profit by – 14.7%. Except China Zheshang Bank Co.Ltd(601916) , the net interest margin of six listed banks decreased year-on-year, and the contribution of net interest margin to the net profit attributable to the parent company was negative. Among them, China Merchants Bank Co.Ltd(600036) net interest margin 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 – 0.3%, which was mainly due to the strong cost control ability of China Merchants Bank Co.Ltd(600036) liability side China Zheshang Bank Co.Ltd(601916) net interest margin was 8bps year-on-year, which was mainly due to the obvious effect of debt side structure adjustment, and the proportion of demand deposits increased significantly, so the cost of debt side decreased significantly.
Due to weak credit demand, the growth rate of asset scale and loan scale of seven banks declined quarter by quarter in 2021. Benefiting from liability side management, the growth rate of deposit scale of listed joint-stock banks increased month on month.
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, except China Zheshang Bank Co.Ltd(601916) , the non-performing loan ratio of the other six listed joint-stock banks decreased month on month. Except China Citic Bank Corporation Limited(601998) , China Minsheng Banking Corp.Ltd(600016) and China Zheshang Bank Co.Ltd(601916) , the provision coverage of the other four listed banks rebounded month on month, indicating that the asset quality differentiation is large, the banks with better asset quality continue to improve, and the provision is more solid. From the perspective of the leading indicators of non-performing loans focusing on the loan ratio, Ping An Bank Co.Ltd(000001) , Industrial Bank Co.Ltd(601166) , China Zheshang Bank Co.Ltd(601916) and China Merchants Bank Co.Ltd(600036) focusing on the loan ratio increased, indicating that there are still some potential risks in its asset quality.
Provision has room to release profits. From the perspective of provision provision, the provision of the seven 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.
The proportion of real estate loans of 7 listed joint-stock banks decreased. Industrial Bank Co.Ltd(601166) real estate loans accounted for 32.93% in 2021, down 1.68% from 21h1.
Investment strategy: according to the disclosed annual reports of listed joint-stock banks, although the quality of bank assets is disturbed by the real estate industry, it continues to improve. Subsequently, with the gradual implementation of the policy, the expectation of loose real estate policy gradually heats up, the expectation of steady economic growth is strengthened, and the quality of bank assets is expected to continue to improve. It is suggested to focus on joint-stock banks with excellent performance and solid asset quality in 2021, such as China Merchants Bank Co.Ltd(600036) , Industrial Bank Co.Ltd(601166) and Ping An Bank Co.Ltd(000001)
Risk warning: policy risk; The risk of macroeconomic recovery falling short of expectations; Covid-19 is at risk of continued deterioration.
