\u3000\u3 China Vanke Co.Ltd(000002) 966 Bank Of Suzhou Co.Ltd(002966) )
Highlights of the quarterly report: 1. The performance remained stable and upward, and the net profit maintained a high increase of 21%. The revenue of Bank Of Suzhou Co.Ltd(002966) in the first quarter continued to maintain a strong growth under the high base, while the growth rate of other non interest income widened, driving the year-on-year growth rate of revenue and PPOP to continue to maintain a slight upward. The company’s asset quality remained excellent, the provision provision was stable, and the year-on-year growth rate of net profit remained at a high increase of 21%. 2. In the first quarter, there was a boom in deposits and loans, and the asset negative structure remained stable on the whole. In the first quarter, credit increased by 15.9 billion in a single quarter (higher than 10.3 billion in the same period of 21 years, mainly contributed by corporate loans), of which corporate loans increased by 9.8 billion in a single quarter, accounting for 60%. The growth of deposits on the liability side was not weak, with an increase of 24 billion in a single quarter, a slight increase compared with the same period in 20 / 21, and the proportion of deposits in interest bearing liabilities remained stable at 66%. 3. The quality of assets is excellent, and the provision is greatly consolidated. Since 3q20, the company has achieved double decline in non-performing for six consecutive quarters, and the focus + non-performing is at the best level in history. 1q22 Bank Of Suzhou Co.Ltd(002966) NPL ratio was 0.99%, down 12bp month on month, and concern + NPL accounted for 1.80%, which was the best level in history. The provision coverage rate in the first quarter was 464%, a significant increase of 41 percentage points month on month.
Insufficient quarterly reports: 1. The single quarter annualized interest rate spread continued the downward trend month on month. The 1q interest rate spread fell slightly by 1bp month on month, and the downward range has been significantly narrowed, mainly due to the drag of asset side yield and the positive contribution of liabilities to interest rate spread. The asset side is expected to be mainly affected by repricing ( Bank Of Suzhou Co.Ltd(002966) q1 repricing loans account for 31% of the total loans). From the perspective of structure, the overall credit structure remains stable. In the future, on the one hand, the one-time factor of asset side credit repricing has been eliminated, and the new interest rate is expected to stabilize. At the same time, the increase in the proportion of retail credit in the structure will also slow down the downward pressure on the asset side yield from the structural point of view, while the interest payment rate on the liability side will continue to benefit from the downward decline of the upper limit of deposit pricing, and the subsequent interest margin is expected to stabilize.
Investment suggestion: 2022e, 2023epb0 66X/0.60X； PE6. 27x / 5.33x (City Commercial Bank pb0.72x / 0.64x; pe5.95x / 5.23x), the company is deeply rooted in Suzhou, and the structure of the business division is unique. Relying on the qualification of the host bank of citizen card, build a perfect system for benefiting the people, obtain a stable retail customer base, and continue to deepen the retail strategy. Intermediary business has shown a good momentum of development, and the income of agency financial management and other businesses has increased rapidly. The asset quality remains excellent, the non-performing rate decreases steadily, the pressure on asset quality is weakened in the future, and the safety margin is high. The future transformation deserves attention, and it is recommended to keep track.
Note: according to the Q1 operation of the company, we fine tune the profit forecast. It is estimated that the revenue of 2022e and 2023e will be 11.73 billion and 13.66 billion respectively (the former value is 11.73 billion and 13.58 billion), and the net profit will be 3.74 billion and 4.4 billion respectively (the former value is 3.65 billion and 4.23 billion).
Risk tip: the macro economy is facing downward pressure, and the operating performance is lower than expected.
