\u3000\u3000 Bank Of Ningbo Co.Ltd(002142) (002142)
Both revenue and profit increased, highlighting the performance and releasing the foundation
The company released the performance express for 2021. The annual revenue and net profit attributable to the parent company were 52.721 billion yuan and 19.515 billion yuan respectively, with a year-on-year increase of 28.24% and 29.67%. The year-on-year growth rate decreased by 0.23 PCT and increased by 2.73 PCT compared with the first three quarters. The company’s revenue and net profit attributable to the parent company maintained a high growth rate, showing the confidence of performance release. The annual weighted average roe reached 16.58%, with a year-on-year increase of 1.68pct.
The company’s operation effectively withstood the impact of the epidemic, and the two-year compound growth rate of the company’s revenue and net profit attributable to the parent reached 22.59% and 19.29% respectively. In a single quarter, the revenue and net profit attributable to the parent company of 21q4 increased by 27.59% and 37.81% year-on-year, both maintaining a good growth level.
Capital ammunition has been replenished, and credit extension can be expanded
At the end of 21q4, the total assets of the company increased by 23.88% year-on-year, and the scale has exceeded RMB 2 trillion, with a year-on-year growth rate of 0.16pct higher than that at the end of Q3; The loan balance increased by 25.45% year-on-year, and the year-on-year growth rate decreased by 2.20pct compared with the end of Q3. The expansion speed of credit supply remained higher than the total assets and at a high level.
The company’s share allotment has been implemented. Calculated according to the weighted net risk assets at the end of the third quarter of 2021, the company’s core tier 1 capital adequacy ratio can be increased by 0.96pct. At the same time, higher performance release level can also promote the company’s endogenous capital supplement. Credit extension is expected to expand.
The company always takes deposits as the basic resources for transformation and development, promotes the deeper and broader development of customer operation and improves the precipitation of low-cost deposits by expanding the customer service value chain. In 2021, the year-on-year growth rate of the company’s deposit balance increased quarter by quarter, reaching 13.81% at the end of 21q4, an increase of 0.72pct compared with the end of 21q3.
The asset quality remained excellent and the provision thickness was further improved
At the end of 21q4, the company’s non-performing rate fell 1bp to 0.77% month on month, a new low in nine years, maintained at a low level of 0.77% – 0.79% in recent three years, and the listed bank at the end of 21q3 was the lowest. In addition, the company’s risk offsetting ability continued to maintain a strong level. The provision coverage rate at the end of 21q4 reached 522.01%, an increase of 6.71pct month on month, at an absolute high in history. Compared with the peers, the company’s provision coverage at the end of 21q3 has ranked third among listed banks.
It is expected that the management will make a smooth transition and the company will operate without worry
The excellent operation of the company is inseparable from the perfect market-oriented management mechanism. After Mr. Luo Mengbo resigned as president and vice chairman and continued to serve as Deputy Secretary of the Party committee, it is likely that the operation of the company will not be disturbed. The five vice presidents have served in the company for many years and have rich experience. It is expected that the management will realize a smooth transition quickly.
Investment suggestion: leading regional urban commercial banks, high performance supporting overestimation
The company is located in the developed areas of Jiangsu and Zhejiang, with developed private economy and rich residents. The social credit environment is good and the regional advantages are obvious. Firstly, the capital factors restricting the expansion of the company’s assets have been solved. Secondly, the acquisition of 70% equity of Huarong Xiaojin will open the regional restrictions on the consumption loan and exhibition industry of urban commercial banks for the company. Finally, the management of the company is expected to achieve a smooth transition. At present, the company has capital, asset expansion space and strong risk control ability. We are optimistic about the release of the company’s future performance. It is expected that the net profit attributable to the parent company will increase by 20.94% and 20.52% year-on-year from 2022 to 23. At present, the company’s corresponding Pb in 2022 is 1.7x, maintaining the target price of 52.32 yuan, and the corresponding Pb in 2022 is 2.3x, maintaining the “buy” rating.
Risk warning: insufficient credit demand, credit risk fluctuation, acquisition less than expected, management change
