Investment Rating - The investment rating for Changshu Bank is "Buy-A" with a 6-month target price of 9.63 CNY, compared to the current stock price of 7.26 CNY [6]. Core Views - Changshu Bank's performance in Q1 2025 shows resilience, with revenue growth of 10.04%, pre-provision profit growth of 12.58%, and net profit growth of 13.81%. Although the growth rates have slightly declined, they remain at a high level [1]. - The bank's performance is primarily driven by the expansion of interest-earning assets and an increase in net non-interest income, despite a significant drag from declining interest margins [1]. Summary by Sections Asset Growth - As of the end of Q1 2025, Changshu Bank's total assets grew by 6.67% year-on-year, with an increase of 22.4 billion CNY in total assets during the quarter. Financial investments contributed 11.7 billion CNY, accounting for 52.00% of the increase, while loans increased by 8.8 billion CNY [2]. - The loan portfolio saw a year-on-year growth of 6.12%, supported by corporate loans, while financial investments increased by 3.36%. The proportion of loans in interest-earning assets decreased by 1.49 percentage points to 63.36% [2]. Retail and Corporate Lending - Retail loan demand remains weak, with a year-on-year growth of only 0.1% in retail loans. The bank has proactively slowed down retail loan disbursements due to ongoing retail risks [3]. - Corporate loans grew by 13.04% year-on-year, with a stable growth rate. The bank focused on supporting technology innovation enterprises and small businesses, with loans of 10 million CNY or less making up 71.33% of total loans [3]. Liability Management - As of the end of Q1 2025, deposits grew by 9.00% year-on-year, outpacing loan growth, with a continuous optimization of the deposit structure. The proportion of demand deposits increased by 1.06 percentage points to 19.17% [4]. Interest Margin and Non-Interest Income - The net interest margin for Q1 2025 was 2.61%, showing a year-on-year decline of 22 basis points but a quarter-on-quarter improvement of 2 basis points. The bank's loan yield was 5.42%, down 21 basis points from the beginning of the year [5]. - Non-interest income saw a significant increase of 62.01% year-on-year, driven by a 495.23% increase in net fee income, primarily due to a low base last year and increased fees from services like precious metals and insurance [9]. Cost Efficiency and Asset Quality - The cost-to-income ratio improved to 34.74%, down 0.52 percentage points year-on-year, indicating initial success in cost reduction and efficiency enhancement [9]. - The non-performing loan ratio improved to 0.76%, with a provision coverage ratio of 489.56%. The bank is expected to continue efforts in managing non-performing loans [9]. Future Outlook - The bank is expected to maintain resilience in performance, with projected revenue growth of 9.71% and profit growth of 13.39% for 2025. The focus will be on optimizing customer service and enhancing small business lending [10].

Investment Rating - The investment rating for the company is "Outperform the Market" [6][10]. Core Views - The company achieved a revenue of 2.971 billion yuan in Q1 2025, representing a year-on-year growth of 10.0%, and a net profit of 1.083 billion yuan, up 13.8% year-on-year. Non-interest income saw a significant increase of 62.0%, contributing to the overall revenue growth [1][4]. - The net interest margin (NIM) decreased by 22 basis points year-on-year to 2.61%, reflecting industry-wide pressure. The company managed to control deposit costs effectively, with the deposit cost rate declining by 19 basis points to 2.01% [2][4]. - Retail loan demand remains weak, with total loans at 249.6 billion yuan, a growth of 3.6% year-on-year. The company is focusing on quality customer selection, leading to a slowdown in loan growth [3][4]. Summary by Sections Financial Performance - In Q1 2025, the company reported a revenue of 2.971 billion yuan, a 10.0% increase year-on-year, and a net profit of 1.083 billion yuan, up 13.8% year-on-year. Non-interest income accounted for 22.0% of total revenue, with a significant increase in fees and other non-interest income [1][4]. - The company forecasts net profits of 4.410 billion yuan, 5.209 billion yuan, and 6.168 billion yuan for 2025, 2026, and 2027, respectively, with year-on-year growth rates of 15.7%, 18.1%, and 18.4% [4][5]. Asset Quality - The non-performing loan (NPL) ratio stood at 0.76%, a slight decrease from the beginning of the year. The provision coverage ratio is at 490%, indicating a strong position compared to peers [3][4]. - The company has a total asset of 389 billion yuan, with loans totaling 249.6 billion yuan and deposits at 309 billion yuan, reflecting a year-on-year growth of 6.6%, 3.6%, and 7.9%, respectively [3][4]. Market Position and Outlook - The company maintains a strong competitive position in the small and micro-enterprise lending market, with a comprehensive network in Jiangsu province and plans for further expansion into other regions [4][6]. - Despite the current economic recovery being slow and micro-loan pressures, the long-term investment value of the company is viewed positively, with a projected price-to-book (PB) ratio of 0.68x for 2025 [4][5].

Investment Rating - The report maintains a "Buy" rating for the company with a target price of RMB 8.86 [8][11]. Core Views - The company demonstrated strong resilience in performance, with a year-on-year increase in net profit and operating income of 13.8% and 10.0% respectively for Q1 2025 [1]. - Non-interest income has significantly supported growth, with a year-on-year increase of 62% in non-interest income for Q1 2025, contributing to a high revenue growth [3]. - The asset quality remains stable, with a non-performing loan ratio of 0.76% and a provision coverage ratio of 490% as of March 2025 [4]. Summary by Sections Financial Performance - For Q1 2025, the annualized ROE and ROA increased by 0.15 percentage points and 0.06 percentage points to 14.89% and 1.23% respectively [1]. - Interest income growth faced pressure, but non-interest income, particularly from investment gains and foreign exchange, showed rapid growth [1][3]. Credit and Interest Margin - As of March 2025, total assets, loans, and deposits grew by 6.7%, 6.1%, and 6.8% respectively, indicating a cautious approach to credit growth [2]. - The net interest margin decreased by 10 basis points to 2.61%, primarily due to pricing pressure on the asset side [2]. Non-Interest Income and Cost Management - Non-interest income accounted for 22.0% of total revenue, up 7.1 percentage points year-on-year, with significant contributions from investment income and foreign exchange [3]. - The cost-to-income ratio improved, decreasing by 5.4 percentage points to 34.7% [3]. Asset Quality and Capital Adequacy - The company maintains a strong asset quality with a non-performing loan generation rate of 1.09% for Q1 2025, indicating potential short-term pressure on small and micro enterprises [4]. - Capital adequacy ratios as of March 2025 were 13.67% for total capital and 10.78% for core Tier 1 capital, reflecting a slight decrease from the end of 2024 [4]. Valuation and Earnings Forecast - The report forecasts net profits for 2025-2027 to be RMB 42 billion, RMB 47 billion, and RMB 53 billion, with year-on-year growth rates of 10.9%, 11.4%, and 11.6% respectively [5]. - The target price corresponds to a price-to-book ratio of 0.85 for 2025, indicating a valuation premium due to the company's resilient business model [5].

Core Viewpoint - Changshu Bank achieved double-digit growth in both revenue and profit in Q1 2025, despite a slight slowdown in scale growth due to weak credit demand. The recovery of the economy is expected to improve demand from small and micro enterprises, providing significant room for credit expansion. Although the net interest margin continues to narrow under asset-side pressure, the ongoing optimization of deposit costs is expected to support the margin. The bank is projected to maintain high single-digit revenue growth and double-digit profit release in 2025. The current low dividend rate has suppressed the bank's valuation, which does not align with its strong fundamentals, indicating substantial potential for valuation recovery if the dividend rate improves in the future [1][10][11]. Financial Performance - In Q1 2025, Changshu Bank reported operating revenue of 2.971 billion yuan, a year-on-year increase of 10%, and a net profit attributable to shareholders of 1.084 billion yuan, up 13.9% year-on-year. The non-performing loan ratio was 0.76%, down 1 basis point quarter-on-quarter, while the provision coverage ratio decreased by 11 percentage points to 489.6% [2][3][9]. Revenue Composition - The bank's net interest income grew by 0.9% year-on-year, reflecting stable growth despite weak credit demand, particularly in small and micro loans. Non-interest income surged by 495.2%, driven by significant growth in fees from insurance and precious metals. Other non-interest income increased by 48.8%, supported by a rise in foreign exchange gains [3][4][5]. Credit Demand and Loan Growth - Credit demand remains weak, leading to a slowdown in loan growth. In Q1 2025, the loan scale increased by 6.1% year-on-year, with corporate loans growing by 7.3% and retail loans by only 0.2%. The bank's strategy of focusing on small and scattered loans has allowed it to maintain a stable loan portfolio despite the challenging environment [5][6][8]. Deposit and Funding Strategy - Changshu Bank's deposits grew by 9% year-on-year, with a notable increase in demand deposits and a reduction in high-cost savings. The bank's proactive management of deposit structure has improved the cost of funding, which is expected to support the net interest margin [7][8]. Asset Quality and Risk Management - The bank's non-performing loan ratio remains low, and it has effectively managed retail asset quality through rigorous risk control and increased write-offs. The non-performing loan ratio is expected to remain stable, allowing for a gradual release of provisions to support profit growth [9][10]. Valuation and Investment Outlook - Despite strong fundamentals, Changshu Bank's current valuation is significantly undervalued at 0.68 times the 2025 PB ratio. The low dividend yield has constrained its valuation, but there is substantial potential for recovery if the dividend rate improves. The bank is expected to maintain high single-digit revenue growth and double-digit profit growth in the coming years [10][11].

Core Viewpoint - Changshu Bank reported a strong performance in Q1 2025, with revenue and net profit showing double-digit growth, driven by enhanced non-interest income contributions [1][2]. Financial Performance - Q1 2025 revenue reached 30 billion, a 10% year-on-year increase, while net profit attributable to shareholders was 11 billion, up 13.8% year-on-year [1]. - The weighted average return on equity (ROAE) improved to 14.9%, an increase of 0.2 percentage points year-on-year [1]. - The growth rates for revenue, pre-provision profit, and net profit in Q1 2025 were 10%, 12.6%, and 13.8% respectively, with slight variations compared to Q4 2024 [2]. Asset and Loan Growth - The growth rate of interest-earning assets and loans as of the end of Q1 2025 was 8.3% and 6.1% respectively, both showing a decline compared to the end of 2024 [3]. - New loans in Q1 2025 totaled 8.8 billion, a decrease of 4 billion year-on-year, with corporate loans being the primary contributor [3]. - The bank's strategy focuses on small and micro enterprises, with loans of 10 million and below accounting for 71.3% of total loans [3]. Deposit Trends - The growth of interest-bearing liabilities and deposits in Q1 2025 was 8.6% and 9% respectively, both lower than at the end of 2024 [4]. - New deposits in Q1 2025 amounted to 22.5 billion, a decrease of 13.1 billion year-on-year, with a notable increase in the proportion of time deposits [4]. Net Interest Margin (NIM) - The net interest margin for Q1 2025 was 2.61%, narrowing by 10 basis points compared to 2024 [5]. - The yield on interest-earning assets decreased to 4.41%, down 33 basis points year-on-year, while the cost of interest-bearing liabilities fell to 2.03%, down 24 basis points [5]. Non-Interest Income - Non-interest income grew significantly, reaching 6.5 billion in Q1 2025, a 62% increase year-on-year, contributing 22% to total revenue [5][6]. - Investment income was 6.7 billion, up 21% year-on-year, despite some losses in fair value changes [6]. Asset Quality - The non-performing loan (NPL) ratio remained low at 0.76%, with a slight decrease from the end of 2024 [6]. - The bank's provision coverage ratio was 489.6%, indicating strong risk absorption capacity [6]. Capital Adequacy - As of the end of Q1 2025, the core Tier 1, Tier 1, and total capital adequacy ratios were 10.8%, 10.8%, and 13.7% respectively, all showing a decline from the end of 2024 [7]. - The bank has a low conversion ratio for its 6 billion convertible bonds, with the current stock price providing room for potential conversion [7]. Future Outlook - The bank maintains a strong growth outlook, with EPS forecasts for 2025-2027 at 1.41, 1.56, and 1.65 respectively, indicating a favorable valuation compared to peers [8].

Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company demonstrated strong revenue resilience with a 10% year-on-year increase in revenue for Q1 2025, reaching 30 billion yuan, and a 13.8% increase in net profit attributable to shareholders, totaling 11 billion yuan [4][5] - Non-interest income has significantly contributed to the overall performance, with a remarkable 62% year-on-year growth in non-interest income, now accounting for 22% of total revenue [9][11] - The bank's net interest margin (NIM) remains under pressure, recorded at 2.61%, down 10 basis points from 2024, influenced by factors such as insufficient effective financing demand and intensified competition [8][11] Summary by Sections Financial Performance - Q1 2025 revenue and net profit growth rates were 10% and 13.8% respectively, with a return on average equity (ROAE) of 14.9%, up 0.2 percentage points year-on-year [4][5] - The bank's non-interest income reached 6.5 billion yuan, with a year-on-year increase of 62%, driven by higher fees from services like precious metals and insurance [9] Asset and Loan Growth - As of the end of Q1 2025, the bank's interest-earning assets and loans grew by 8.3% and 6.1% year-on-year, respectively, indicating a slight slowdown in asset expansion [6] - New loans added in Q1 2025 amounted to 8.8 billion yuan, with a notable focus on corporate loans, which accounted for 66 billion yuan of the new loans [6] Deposit Trends - The growth rate of interest-bearing liabilities and deposits was 8.6% and 9% year-on-year, respectively, showing a decline compared to the end of 2024 [7] - The bank's deposit structure is showing signs of improvement, with a slight increase in the proportion of fixed-term deposits [7] Risk and Capital Adequacy - The non-performing loan (NPL) ratio remained low at 0.76%, with a strong risk coverage capability indicated by a provision coverage ratio of 489.6% [10] - Capital adequacy ratios as of Q1 2025 were 10.8% for core tier 1 and 13.7% for total capital, reflecting a solid capital position [10] Earnings Forecast and Valuation - The report projects earnings per share (EPS) for 2025-2027 at 1.41, 1.56, and 1.65 yuan, with corresponding price-to-book (PB) ratios of 0.68, 0.60, and 0.54 [11][12]

Core Viewpoint - Changshu Bank reported a strong performance in Q1 2025, with revenue of 3 billion yuan and a net profit of 1.1 billion yuan, indicating year-on-year growth of 10.04% and 13.81% respectively [1][2]. Group 1: Performance - Revenue and net profit growth rates for Q1 2025 were 10.04% and 13.81%, showing a slight decline from the previous year's growth rates by 0.5 percentage points and 2.4 percentage points respectively [2]. - Net interest income increased by 0.91% year-on-year, but the growth rate decreased by 6.6 percentage points compared to the previous year, with a net interest margin of 2.61%, down 10 basis points [2]. - Non-interest income saw significant growth, with net fee and commission income increasing by 495.23% due to a low comparative base from the previous year, and other non-interest income rising by 48.84% [3]. Group 2: Asset Quality - The non-performing loan ratio stood at 0.76%, a decrease of 1 basis point from the previous quarter, while the provision coverage ratio was 489.56%, down 11 percentage points from the end of the previous year [4]. - The credit cost for Q1 2025 was 0.96%, reflecting a year-on-year increase of 5 basis points [4]. Group 3: Assets and Liabilities - As of the end of Q1 2025, total assets and loans were 389 billion yuan and 249.6 billion yuan, respectively, showing year-on-year growth of 6.67% and 6.12% [5]. - Total deposits reached 309 billion yuan, a year-on-year increase of 9.00%, with a net increase of 22.5 billion yuan in the quarter, primarily driven by time deposits [5]. - The proportion of demand deposits increased to 19.17%, up 1.06 percentage points from the beginning of the year, indicating a strategic shift in deposit pricing [5]. Group 4: Investment Outlook - Changshu Bank is viewed as having a rare "growth" attribute, with stable asset quality and a high provision buffer, suggesting continued strong performance in the coming years [5]. - Projected net profits for 2025-2027 are expected to be 4.3 billion, 4.8 billion, and 5.3 billion yuan, reflecting year-on-year growth rates of 12.22%, 11.70%, and 10.17% respectively [5].

Core Viewpoint - The key feature of the recent quarterly report from Changshu Bank is a significant slowdown in growth rate, with total assets and loans growing at 6.7% and 6.6% respectively, marking the lowest growth rates since 2012 [2][3] Group 1: Performance Metrics - As of the end of Q1, the bank's total assets grew by 6.7%, and loans increased by 6.6%, both lower than the previous year's growth rates [2] - The deposit growth rate was 9.4%, which, while lower than previous rates, still exceeded the growth rates of assets and loans [2] - The bank has actively reduced its scale expansion demands and lowered interbank liabilities, reflecting a pragmatic choice in the current uncertain macroeconomic environment [2] Group 2: Strategic Positioning - Changshu Bank differentiates itself by focusing on "true small and micro loans," which emphasizes genuine small business needs and filling financial service gaps [2] - The bank's growth premium is derived from its commitment to "true small and micro," which is based on real operational demands [2] - The current macroeconomic conditions, including weak consumer confidence and real estate recovery, have led to a cautious approach in scaling up, aligning with the bank's strategic focus [2] Group 3: Future Outlook - The bank maintains excellent asset quality and a stable asset-liability structure, with room for deposit pricing adjustments [3] - Despite the low demand for small and micro loans and macroeconomic uncertainties, the bank's adherence to its "true small and micro" strategy positions it well for future demand recovery [3] - Ongoing fiscal policies are expected to eventually translate into increased demand for small and micro loans, potentially restoring the bank's growth premium [3]

Investment Rating - The report maintains a "Buy" rating for Changshu Bank [6]. Core Views - Changshu Bank reported a revenue of 3 billion yuan in Q1 2025, representing a year-on-year growth of 10.04%, and a net profit attributable to shareholders of 1.1 billion yuan, up 13.81% year-on-year. The non-performing loan ratio and provision coverage ratio were 0.76% and 489.56%, respectively, showing slight improvements from the previous quarter [1][2][3]. Performance Summary - **Revenue and Profit Growth**: In Q1 2025, the growth rates for operating revenue and net profit attributable to shareholders were 10.04% and 13.81%, respectively, with non-interest income contributing positively to performance. Net interest income grew by 0.91% year-on-year, while fee and commission income surged by 495.23% due to a low comparative base from the previous year [2]. - **Asset Quality**: The non-performing loan ratio decreased by 1 basis point to 0.76%, with a provision coverage ratio of 489.56%, indicating a stable asset quality. The credit cost was 0.96%, reflecting a year-on-year increase of 5 basis points [3]. - **Balance Sheet Strength**: As of Q1 2025, total assets and loans reached 389 billion yuan and 249.6 billion yuan, respectively, with year-on-year growth of 6.67% and 6.12%. The bank's deposit total was 309 billion yuan, up 9.00% year-on-year, with a notable increase in the proportion of demand deposits [4]. Financial Projections - The report forecasts net profits attributable to shareholders for 2025, 2026, and 2027 to be 4.3 billion yuan, 4.78 billion yuan, and 5.27 billion yuan, respectively, with year-on-year growth rates of 12.22%, 11.70%, and 10.17% [4].

证券研究报告 | 季报点评 gszqdatemark 2025 04 26 年 月 日 常熟银行（601128.SH） 资产质量保持稳健，活期存款占比提升 事件：常熟银行披露 2025 年一季报，2025 年一季度实现营收 30 亿元， 同比增长 10.04%，归母净利润 11 亿元，同比增长 13.81%。2025Q1 末 不良率、拨备覆盖率分别为 0.76%、489.56%，较上季度末分别下降 1bp、 下降 11pc。 1、业绩表现：其他非息收入对营收形成支撑 25Q1 营业收入、归母净利润增速分别为 10.04%、13.81%，分别较 24A 下降 0.5pc、下降 2.4pc，其中非息收入增长、费用节约对业绩形成正向贡 献，具体来看： 1）利息净收入：同比增长 0.91%，较 24A 增速下降 6.6pc，25Q1 净息差 为 2.61%，较 24A 下降 10bps（24Q1 下降 3bps），或主要源于生息资产 收益率仍延续下降趋势，25Q1 生息资产、贷款收益率分别下降 25bps、 下降 21bps，计息负债、存款成本率分别下降 17bps、下降 19bps。 2）手续费及佣金净收入：同比增 ...