By the time of press release on January 16, nine banks had taken the lead in disclosing the performance express in 2021, of which eight had a year-on-year increase in net profit of more than 20%. At the same time, the non-performing loan ratio by the end of last year was lower than that at the beginning of last year. Insiders pointed out that from the current performance express, the annual performance growth of the banking industry last year was higher than that in the first three quarters, reflecting the continuous improvement of profitability. The year-on-year decline in non-performing ratio and the year-on-year increase in provision coverage of many banks mean that the overall asset quality shows an improvement trend.
In terms of total performance, China Merchants Bank Co.Ltd(600036) is the most outstanding among the listed banks that have disclosed the performance express. In 2021, the net profit attributable to the shareholders of the parent company (hereinafter referred to as “net profit attributable to the parent”) was 119.922 billion yuan, an increase of 23.2% compared with 97.342 billion yuan in the same period last year. The net profit attributable to the parent company in Industrial Bank Co.Ltd(601166) and China Citic Bank Corporation Limited(601998) 2021 were 82.58 billion yuan and 55.641 billion yuan respectively.
It is worth noting that the net profit growth of many banks last year was very strong. According to the data, Bank Of Jiangsu Co.Ltd(600919) realized a net profit attributable to the parent company of 19.694 billion yuan last year, with a year-on-year increase of 30.72%, the highest increase among all banks at present. Jiangsu Zhangjiagang Rural Commercial Bank Co.Ltd(002839) the growth rate of net profit ranked second. Last year, the net profit attributable to the parent company was 1.299 billion yuan, with a year-on-year increase of 29.77%. In addition, Ping An Bank Co.Ltd(000001) , Industrial Bank Co.Ltd(601166) , China Merchants Bank Co.Ltd(600036) and other net profits increased by more than 20% last year, and China Citic Bank Corporation Limited(601998) also reached 13.60%.
Performance express data show that the asset quality of listed banks is also improving. According to incomplete statistics by the reporter of the economic information daily, among the listed banks that disclosed the performance express, the non-performing rate of eight banks in 2021 decreased compared with the end of the previous year, and all were below 1.5%, of which three had a non-performing rate of less than 1%, and the Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) non-performing rate was only 0.81%.
At the same time, the provision coverage rate of eight banks has increased, the provision coverage rate of Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) temporarily ranks first, reaching 531.98%, and the provision coverage rate of four banks, such as China Merchants Bank Co.Ltd(600036) , Jiangsu Zhangjiagang Rural Commercial Bank Co.Ltd(002839) , exceeds 400%. In addition, the provision coverage at the end of Jiangsu Zhangjiagang Rural Commercial Bank Co.Ltd(002839) and Jiangsu Suzhou Rural Commercial Bank Co.Ltd(603323) 2021 increased significantly compared with the beginning of the year, by 171.67 percentage points and 105.79 percentage points respectively.
The banking sector performed poorly in the second half of 2021. According to the data, from early July 2021 to the end of 2021, the Shenwan banking index has fallen by about 10.26%, ranking the fourth among the 31 Shenwan industries, and the valuation is at a historical low. However, supported by good performance expectations, the banking sector has recovered significantly since 2022. Data show that the Shenwan banking index has risen 1.78% this year, ranking first in all industries.
Many institutions expect that the fundamentals of the banking sector will continue to improve in the future. Minsheng Securities said that the expansion supports the net interest income, other non interest income will still increase high from the fourth quarter of 2021 to the first quarter of 2022, the supporting revenue can still continue to improve, the asset quality is continuously optimized, the provision is maintained at a low level, and the profit growth can still operate at a high level. China Industrial Securities Co.Ltd(601377) also believes that the credit opening in 2022 is in hot progress, the bank’s early project reserves are positive, and the willingness and intensity of credit opening may exceed market expectations, which is good for the improvement of industry fundamentals.
