\u3000\u3000 Bank Of Ningbo Co.Ltd(002142) (002142)
Event:
On January 17, Bank Of Ningbo Co.Ltd(002142) released the performance express for 2021. In 2021, it realized an operating revenue of 52.721 billion, a year-on-year increase of 28.2%; The net profit attributable to the parent company was 19.515 billion yuan, a year-on-year increase of 29.7%. The weighted average return on net assets was 16.58%, a year-on-year increase of 1.68 percentage points.
Comments:
Both revenue and profit maintained a high growth rate. Bank Of Ningbo Co.Ltd(002142) continue to promote the construction of the moat of Treasury, Guojin, retail companies and wealth management, and continuously accumulate comparative advantages. In 2021, the year-on-year growth rates of revenue and net profit attributable to the parent company were 28.2% and 29.7% respectively, with the growth rates of – 0.2pct and 2.7pct respectively compared with 1-3q, and the growth rate of revenue and profit continued to be at a high level. The balance of provision for loan losses increased by 25.7% year-on-year and 3.0% month on month (vs. the quarter on quarter growth rates at the end of 1q, 2q and 3q in 2021 were 7.1%, 8.3% and 5.2% respectively). The provision increased the back feeding of profits. The year-on-year growth of 4q’s single quarter revenue and net profit attributable to the parent company were 27.6% and 37.8% respectively.
The asset side maintains strong growth momentum and has strong ability to obtain core liabilities. Bank Of Ningbo Co.Ltd(002142) deeply cultivate high-quality areas such as Jiangsu and Zhejiang, with strong regional economic vitality and strong credit demand. At the end of 2021, the year-on-year growth rates of total assets and loans were 23.9% and 25.5% respectively, with a change of 0.2pct and – 2.2pct respectively compared with the end of 3q. At the end of 2021, the proportion of loans in total assets was 42.8%, and the proportion of loans has basically stabilized at about 43% since 2021. By the end of 2021, deposits had a year-on-year growth rate of 13.8%, 0.7pct higher than that at the end of 3q. Under the great pressure of “stabilizing and increasing deposits” in the banking industry, Bank Of Ningbo Co.Ltd(002142) 2q21 deposit growth has still increased quarter by quarter, highlighting the strong ability to obtain core liabilities.
The non-performing loan ratio decreased steadily, and the asset quality continued to improve. By the end of 2021, Bank Of Ningbo Co.Ltd(002142) NPL ratio had slightly decreased by 1bp quarter on quarter to 0.77%, and has remained stable below 0.8% since the end of 2018, which is a low level for listed banks. The provision coverage increased slightly by 6.7pct to 522.0% quarter on quarter, and the provision thickness continued to be at the leading level in the industry. The quality of assets has been continuously improved and the ability of risk offset is strong.
Earnings forecast, valuation and rating. Bank Of Ningbo Co.Ltd(002142) deeply cultivate high-quality business areas such as Jiangsu, Zhejiang and Shanghai, and the growth rate of revenue and profit has continued to be strong in recent years. In December 2021, the placement of shares will further consolidate the growth momentum of the asset side in the future. At the same time, building an all staff wealth marketing system is expected to further promote the development of big wealth management business. Combined with the performance express of 2021, the forecast of net profit attributable to parent company from 2021 to 23 was raised to 19.516 billion yuan (+ 5.8%), 23.675 billion yuan (+ 6.1%) and 28.279 billion yuan (+ 6.5%), corresponding to EPS forecast of 2.96/3.59/4.28 yuan, maintaining the “buy” rating.
Risk tip: if the macroeconomic growth slows down, it may affect the effective credit demand and drag down the asset side expansion of the company.
