Ping An Bank (000001) 2019 Third Quarterly Report Review-Performance Maintains High Growth and Steady Progress
The company’s good strategy of negative capital drive revenue and profit continue to improve, the overall risk is stable, the retail transformation has achieved significant, and future growth is still expected.
Maintain the “overweight” rating.
Event: Ping An Bank’s operating income and net profit attributable to mothers in the first three quarters of 2019 increased further18.
8% and 15.
5%, with an expected average ROE of 12.
85% (annualized), the non-performing loan ratio remained at 1.
Earnings continued to grow at a high rate, generally in line with expectations.
In the first three quarters, the net profit attributable to the mother was +15 for ten years.
5% (+15 in the first half).
Highest income continued to perform well (+18 in the first three quarter quarters).
8%, +18 in the first half.
5%), of which net interest and net fee continued to increase due to the low base last year; gradual provisioning and maintenance remained stable (at least +21 in asset impairment losses in the first three quarters).
9%, + 22% in the first half).
In the third quarter, asset expansion accelerated slightly and the structure became more stable.
The company’s total assets in Q3 were +3 from the previous quarter.
26% (Q1 / Q2 +3 respectively.
26% / 1.
72%): 1) Credit retail credit placement strategy is more robust. In the third quarter, the number of new loans was 69.3 billion. Retail is still a strategic direction (48.4 billion new). The increase in structure is mainly contributed by “other” personal loans (32.7 billion), mainly licensed mortgage loans, small consumer loans and other guaranteed or pledged loans), while credit cards have improved (Q1 / Q2 / Q3 increased by 19 billion / 18.7 billion / 80 billion).Auto lending resumed a slight net increase, and corporate loans also resumed growth (an increase of 20.9 billion).
2) Financial investment was more active than in the second quarter, with an increase of 69.3 billion in the third quarter, which was thought to be due to the increase in bonds and interbank investment.
The margin of loan pricing has weakened, driving the interest rate margin to decrease slightly from the previous quarter.
The company disclosed the first three quarters of net interest margin2.
62%, of which 2 in the third quarter.
62% (Q1 / Q2 is 2.
53% / 2.
71%), mainly due to the decline in the rate of return on assets (Q3 interest-earning asset yield / interest-bearing resistance interest payment rate QoQ Q2 decreased by 10BPs / 2BPs respectively).
1) Return on assets: The decline in loan interest rates is the main reason (down 19BPs month-on-month). The loan rate on public loans has dropped significantly, which is believed to be related to weak corporate financing needs. The personal loan is due to the structural adjustment and the addition of credit cards has decreased.At the same time, some mortgage loans have been 重庆耍耍网 increased, resulting in lower overall yields; 2) The interest rate on interest payments has mainly benefited from the decline in the cost of interbank certificates of deposit, which can still make a positive contribution to changes in net interest margin.
The growth rate of non-interest income decreased from the first half of the year, which was related to the adjustment of accounting standards.
The first three quarters of non-interest income are +14 per year.
2% (+22 in the first half of the year.
1%), it is speculated that the growth rate of other non-interest income in Q3 this year has slowed down compared with the first half of the year due to high bases such as investment income resulting from the conversion of accounting standards last year.
However, the company’s net fee income has increased significantly (first half / first three quarters +2).
5% / + 17.
4%). The decrease was a low base last year. The transformation should also see the positive contribution of the company’s continued transformation of retail transformation. In particular, the wealth management business continued to strengthen, and retail customers’ AUM increased by 6 from the previous quarter.
At 7%, AUMs of private customers meeting standards increased by 9 from the previous month.
Asset quality was generally stable, and provision levels were further consolidated.The Q3 company’s NPL ratio was flat month-on-month (1.
68%), the non-performing balance increased by 1.2 billion, which was longer than the previous two quarters (Q1 / Q2 increased by 5.
100 million / -4.
900 million), while the attention rate and overdue 90 + / bad deviation degree continued to decline Q2 (down 9BPs / 6 respectively.
8 pieces to 2.
39% / about 87%), which may indicate that the company increased the intensity of adverse exposure and disposal in the third quarter, and achieved the overall stability of the book risk data.
The risks of classified loans declined steadily. The NPL ratio of mortgages and auto loans increased slightly from the previous month but remained at a relatively high level, while the NPL ratios of credit cards, new loans and other personal loans declined.
Provisions continued to be actively responded to, and Q3’s provisioning provisions remained positive (Q1 / Q2 / Q3 single-quarter asset impairment losses of 12.9 billion / 14.3 billion / 13.8 billion), and the provision coverage ratio rose to 186.
18% (+3 MoM).
Risk factors: stalling macroeconomic growth; worse-than-expected retail loan quality deterioration.
Investment suggestion: The company’s good strategy of negative capital deployment drives the income and profit to continue to improve, the overall risk is stable, the retail transformation has achieved significant, and future growth is still expected.
Slightly raised the rapid forecast for the growth of net profit attributable to ordinary shareholders of the parent company in 2019/20 to 16.
18% / 16.
8% (previous forecast 15).
69% / 15.
49%), while taking into account the increase in equity after conversion of convertible bonds, the EPS forecast is lowered to 1.
67 yuan (previous forecast 1).
86 yuan), currently expected to correspond to January 2019.
Maintain the “overweight” rating.