A-share listed banks ushered in the intensive disclosure period of 2021 performance express. As of January 24, 16 A-share listed banks have disclosed their 2021 performance express. From the disclosed data, the bank’s asset scale and profit growth have increased significantly in 2021, and nearly 70% of the bank’s net profit attributable to the parent has increased by more than 20%. At the same time, the asset quality of listed banks has also improved significantly, the non-performing loan ratio has generally decreased, and the provision coverage has increased significantly.
Insiders said that the performance of A-share listed banks maintained an upward trend, thanks to the continuous repair of the macro economy and the steady operation of the banking industry itself. Looking forward to 2022, analysts expect that under the background of “stability” of various policies, China’s economy is expected to remain at a reasonable level and the growth of bank profits will return to normal.
net profit growth picked up
In 2021, the business performance of commercial banks continued to pick up. After reaching the bottom in the first quarter of 2021, the revenue growth of commercial banks rebounded steadily. From the 16 banks that have disclosed the data, the growth rate of net profit attributable to the shareholders of the parent company has reached double digits, and 11 banks have increased by more than 20%.
At present, no major banks have disclosed performance data. From the disclosed performance, the joint-stock bank has stepped out of the previous downturn of weak profitability. The net profit attributable to the parent company in 2021 for China Everbright Bank Company Limited Co.Ltd(601818) , China Merchants Bank Co.Ltd(600036) , Industrial Bank Co.Ltd(601166) , China Citic Bank Corporation Limited(601998) , Ping An Bank Co.Ltd(000001) was 43.407 billion yuan, 119.922 billion yuan, 82.680 billion yuan, 55.641 billion yuan and 36.336 billion yuan respectively, with a year-on-year increase of 14.73%, 23.20%, 24.10%, 13.60% and 25.6% respectively.
In terms of asset scale, with the increase of support for the real economy and credit in 2021, the scale of bank assets also increased significantly. For example, China Merchants Bank Co.Ltd(600036) the total assets by the end of 2021 were 9.27 trillion yuan, an increase of 10.90% over the beginning of last year. The total assets of Industrial Bank Co.Ltd(601166) reached 8.60 trillion yuan, an increase of 8.96% over the beginning of last year. The asset scale of China Citic Bank Corporation Limited(601998) also exceeded the 8 trillion yuan mark. The total assets of the bank as of the end of last year were 8.04 trillion yuan, an increase of 7.06%.
The profit growth of regional banks is stronger. By the end of 2021, except that the net profit attributable to the parent of Bank Of Changsha Co.Ltd(601577) increased by 18.09% year-on-year and that of Shanghai Rural Commercial Bank increased by 18.81%, the net profit attributable to the parent of other A-share listed local banks had increased by more than 20%. The year-on-year growth of net profit attributable to parent company of Bank Of Jiangsu Co.Ltd(600919) , Bank Of Ningbo Co.Ltd(002142) , Jiangsu Zhangjiagang Rural Commercial Bank Co.Ltd(002839) , Bank Of Suzhou Co.Ltd(002966) , Jiangsu Suzhou Rural Commercial Bank Co.Ltd(603323) , Bank Of Qingdao Co.Ltd(002948) , Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) , Jiangsu Jiangyin Rural Commercial Bank Co.Ltd(002807) , Qilu Bank Co.Ltd(601665) was 30.72%, 29.67%, 29.77%, 20.57%, 20.72%, 22%, 21.13%, 20.81% and 20.52% respectively.
\u3000\u3000 “In 2021, the performance of listed banks increased rapidly, thanks to the steady recovery of China’s macro economy and the flexibility and moderation of prudent monetary policy. A series of measures such as comprehensively reducing reserve requirements and strengthening the supervision of deposit interest rates effectively reduced the cost of bank funds, which was conducive to the basic stability of the interest margin of listed banks. In addition, in order to serve the real economy and support the development of small, medium-sized and micro enterprises, listed banks Banks have accelerated credit extension, which has promoted the rapid growth of interest income; The listed banks themselves are also constantly optimizing the asset quality, and the non-performing loan ratio has decreased steadily, reducing the impact of provision provision provision on profit growth. ” Dong ximiao, chief researcher of Zhaolian finance, said.
China Merchants Securities Co.Ltd(600999) Liao Zhiming, chief analyst of the banking industry, said that the performance express with frequent good news indicates that the overall profitability of listed banks has maintained a good level in 2021. Among them, the performance of high-quality urban commercial banks and joint-stock banks will be more brilliant. The strong profit growth in 2021 also makes the valuation of the banking sector out of last year’s trough.
decline in non-performing rate and increase in provision
While the profit increases, the asset quality also continues to improve. From the perspective of A-share listed banks that have disclosed the performance express of 2021, the non-performing loan ratio and provision coverage ratio have improved compared with the end of 2020, the non-performing loan ratio of many banks has decreased, the provision coverage ratio has increased, and the risk offset ability has been further enhanced.
Among the joint-stock banks, Ping An Bank Co.Ltd(000001) the non-performing loan ratio at the end of 2021 was 1.02%, a year-on-year decrease of 0.16 percentage points, and the provision coverage rate was 288.42%, a year-on-year increase of 87.02 percentage points. China Everbright Bank Company Limited Co.Ltd(601818) the non-performing loan ratio was 1.25%, a year-on-year decrease of 0.13 percentage points, and the provision coverage reached 187.02%, a year-on-year increase of 4.31 percentage points. The non-performing loan ratio was 1.10%, down 0.15 percentage points, and the provision coverage ratio was 268.73%, up 49.90 percentage points. China Merchants Bank Co.Ltd(600036) the non-performing loan ratio was 0.91%, a year-on-year decrease of 0.16 percentage points, and the provision coverage rate was as high as 441.34%, an increase of 3.66 percentage points. The non-performing loan ratio was 1.39%, a year-on-year decrease of 0.25 percentage points, and the provision coverage rate was 182.14%, an increase of 10.46 percentage points.
Some regional banks have a thicker “family background”. According to the performance express, Bank Of Ningbo Co.Ltd(002142) , Jiangsu Changshu Rural Commercial Bank Co.Ltd(601128) provision coverage exceeded 500%, and Jiangsu Zhangjiagang Rural Commercial Bank Co.Ltd(002839) , Jiangsu Suzhou Rural Commercial Bank Co.Ltd(603323) provision coverage also exceeded 400%.
In terms of asset quality, the non-performing loan ratio of regional banks that have disclosed data has all decreased. For example, by the end of 2021, Jiangsu Jiangyin Rural Commercial Bank Co.Ltd(002807) non-performing loan ratio was 1.32%, a year-on-year decrease of 0.47 percentage points. The non-performing loan ratio was 1.00%, down 0.28 percentage points. The non-performing loan ratio at the end of 2021 was only 0.77%, a year-on-year decrease of 0.02 percentage points. The non-performing loan ratio was 0.81%, down 0.15 percentage points from the beginning of the year. The non-performing loan ratio was 0.95%, down 0.22 percentage points from the beginning of the year.
Talking about the reasons for the general improvement of asset quality of many banks in 2021, Postal Savings Bank Of China Co.Ltd(601658) researcher Lou Feipeng analyzed that, on the one hand, the absolute amount of loans increased year-on-year in 2021, increasing the denominator, which helped to reduce the non-performing rate. On the other hand, the banking industry reduces credit risk by adjusting the structure of loan industry and region, and increases the disposal of non-performing assets such as loan restructuring and loan write off. In addition, the bank has also improved its risk management, including improving the basic efficiency of risk management, strengthening the application of science and technology and improving risk early warning, all of which help to improve the quality of assets.
it is expected to grow steadily in 2022
While the performance in 2021 is expected, the performance of listed banks in 2022 is still expected to maintain a stable growth trend.
Zeng Gang, deputy director of the national finance and development laboratory, judged that the profit growth rate of commercial banks in 2022 is expected to be stable as a whole, which basically maintains a level commensurate with the growth rate of the real economy. He said that at present, China’s economic development is facing triple pressures of shrinking demand, supply shock and weakening expectations. After the implementation of a series of policies in the first and second quarters, the real economy is expected to rebound in the second half of the year. Therefore, in this context, the operation of financial institutions will be generally consistent, and the profit growth rate will be stable, stable and reasonable.
Liao Zhiming believes that looking forward to 2022, the economy is expected to stabilize and recover in the follow-up, the interest margin is stable, the asset scale is steadily expanded, and the credit cost remains stable and slightly reduced. It is expected that the overall profit growth rate of A-share listed banks is about 7%, which is a high level in recent six years.
Tang Jianwei, chief researcher of the financial research center of BOCOM, said that compared with the sharp recovery of the profits of listed banks in 2021, it is expected that the year-on-year growth rate of the annual net profits of listed banks in 2022 may fall, but the growth rate will still reach about 6.5%. With the more prudent risk appetite of commercial banks and the increase in the disposal of non-performing assets, it is expected that the overall asset quality will be stable and controllable in 2022, and the average non-performing rate will remain at about 1.8%.
It is worth mentioning that with the disclosure of the recent performance express, bank stocks have also ushered in a wave of “rising voice”, which is significantly better than other sectors.
