\u3000\u3000 Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) (601128)
Event: Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) announced the performance express for 2021. In 2021, the growth rate of revenue was 16.27%, and the growth rate of net profit attributable to parent company was 21.13%. The performance was excellent. Our comments are as follows:
\u3000\u30001. It is expected that the net interest margin will continue to improve month on month, supporting the revenue. Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) in 2021, the revenue growth showed a trend of picking up quarter by quarter, and the core reason was the stable recovery of net interest margin. From the performance of the fourth quarter, we expect that the net interest margin is still in the improvement channel month on month, in which the asset side yield increased slightly and the liability side cost decreased, which jointly driven the improvement of net interest margin, supporting the growth of net interest income and revenue.
Looking forward to 2022, we expect that the Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) net interest margin is still expected to rise steadily without major changes in regulatory policies. On the asset side, by making small and credit loans to improve the asset side pricing ability, the asset yield is expected to rise. From the interest rate trend of inclusive small and micro loans disclosed by the cbcirc, it has been in an upward trend since the second quarter of 2021.
On the liability side, with the efforts of the whole bank, the deposit cost of Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) will decline in 2021, but the deposit growth is relatively slow. Considering the balance between volume and price, we expect the decline of Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) deposit cost to slow down in 2022.
\u3000\u30002. The quality of assets remains relatively good. At the end of 2021, Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) non-performing rate was 0.81%, unchanged month on month, at the best level in the past few years. Meanwhile, the provision coverage increased by 10pc to 531.98% month on month, and the ability to resist risks was further enhanced.
\u3000\u30003. Roe rebounded. Due to the impact of the epidemic, the Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) roe decreased to 10.34% and the ROA decreased to 0.98% in 2020. In 2021, with the macro economy gradually getting rid of the impact of the epidemic, both Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) ROA and roe bottomed out and rebounded, and the core profitability was enhanced.
Investment suggestion: we expect the company's revenue growth rate to be 16.07% and net profit growth rate to be 20.83% in 2022. We give the investment rating of buy-a. the six-month target price is 8.99 yuan, equivalent to 1.19xpb in 2021.
Risk tip: the intensified competition of small and micro businesses leads to the narrowing of interest margin; Significant deterioration of asset quality;
