大众金融控股(00626) - 2025 - 中期业绩

Financial Statements Overview Condensed Consolidated Income Statement The Group achieved a turnaround to a net profit of HKD 2.57 million for the six months ended June 30, 2025, driven by a 12.7% increase in net interest income and a 31.1% rise in net fee and commission income | Metric | Six Months Ended June 30, 2025 (HKD thousands) | Six Months Ended June 30, 2024 (HKD thousands) | Y-o-Y Change | | :--- | :--- | :--- | :--- | | Net Interest Income | 530,513 | 470,710 | +12.7% | | Net Fee and Commission Income | 138,802 | 105,872 | +31.1% | | Operating Income | 685,161 | 593,909 | +15.4% | | Operating Expenses | (465,183) | (432,844) | +7.5% | | Credit Loss Expense | (155,870) | (164,303) | -5.1% | | Profit/(Loss) Before Tax | 17,956 | (27,605) | Turnaround to Profit | | Profit/(Loss) for the Period | 2,567 | (34,493) | Turnaround to Profit | | Basic Earnings Per Share (HKD) | 0.002 | (0.031) | Turnaround to Profit | Condensed Consolidated Statement of Comprehensive Income Total comprehensive income for the period significantly improved to HKD 59.8 million from a loss of HKD 61.06 million in the prior year, driven by the period's profit turnaround and positive changes in debt securities and exchange differences - Other comprehensive income for the period recorded HKD 57.23 million, compared to a loss of HKD 26.57 million in the prior year, due to improved net gains on debt securities investments and exchange differences[4] - Total comprehensive income attributable to owners turned from a loss of HKD 61.06 million in the prior year to a gain of HKD 59.8 million, combining profit for the period and other comprehensive income[4] Condensed Consolidated Statement of Financial Position As of June 30, 2025, total assets increased by 1.7% to HKD 43.59 billion, driven by growth in customer loans and debt securities, with total liabilities also rising to HKD 35.85 billion due to increased customer deposits | Key Balance Sheet Items | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | Change | | :--- | :--- | :--- | :--- | | Customer Loans and Advances | 24,615,452 | 24,192,793 | +1.7% | | Debt Securities Investments | 8,389,808 | 6,624,576 | +26.6% | | Total Assets | 43,589,772 | 42,843,996 | +1.7% | | Customer Deposits | 33,229,927 | 32,173,517 | +3.3% | | Total Liabilities | 35,851,219 | 35,143,279 | +2.0% | | Total Equity | 7,738,553 | 7,700,717 | +0.5% | Condensed Consolidated Statement of Changes in Equity Total shareholders' equity slightly increased to HKD 7.74 billion as of June 30, 2025, primarily due to the period's profit and other comprehensive income, partially offset by declared dividends - Dividends declared during the period amounted to HKD 21.96 million[7] - Shareholders' equity increased by approximately 0.5% from HKD 7.70 billion at the beginning of the period to HKD 7.74 billion at the end of the period[7] Notes to the Interim Financial Statements Note 5: Segment Information The Group's primary business segments are Retail and Commercial Banking, Wealth Management, and Other Businesses, with Retail and Commercial Banking contributing 87.7% of operating income, while wealth management and securities services saw significant growth | Operating Segment | Operating Income (H1 2025, HKD thousands) | Operating Income (H1 2024, HKD thousands) | Profit/(Loss) Before Tax (H1 2025, HKD thousands) | Profit/(Loss) Before Tax (H1 2024, HKD thousands) | | :--- | :--- | :--- | :--- | :--- | | Retail and Commercial Banking | 601,019 | 536,807 | 26,432 | (30,611) | | Wealth Management Services, Stockbroking and Securities Management | 73,025 | 46,643 | 33,849 | 22,326 | | Other Businesses | 11,117 | 10,459 | (42,325) | (19,320) | | Total | 685,161 | 593,909 | 17,956 | (27,605) | - Geographically, Hong Kong contributed the vast majority of revenue, accounting for 94.7% of the total[26] Note 10: Credit Loss Expense Credit loss expense for the period decreased by 5.1% to HKD 156 million, primarily driven by credit losses on customer loans, with a significant portion attributed to credit-impaired (Stage 3) loans | Financial Instrument | Credit Loss Expense (H1 2025, HKD thousands) | Credit Loss Expense (H1 2024, HKD thousands) | | :--- | :--- | :--- | | Customer Loans | 155,558 | 139,835 | | Others | 312 | 24,468 | | Total | 155,870 | 164,303 | Note 12: Dividends The Board declared an interim dividend of HKD 0.02 per ordinary share for the year ending December 31, 2025, with no interim dividend paid in the prior corresponding period - An interim dividend of HKD 0.02 per share was declared, totaling HKD 21.96 million[39] - The dividend will be paid on August 1, 2025[68] Note 14: Customer Loans and Advances Total customer loans and advances increased by 1.9% to HKD 25.01 billion, but asset quality deteriorated with credit-impaired loans significantly rising from HKD 546 million to HKD 772 million, increasing their proportion of total loans from 2.23% to 3.10% | Loan Status | June 30, 2025 (HKD thousands) | December 31, 2024 (HKD thousands) | | :--- | :--- | :--- | | Neither Past Due Nor Impaired | 23,565,407 | 23,356,203 | | Past Due But Not Impaired | 659,257 | 622,579 | | Credit Impaired | 789,434 | 563,254 | | Total | 25,014,098 | 24,542,036 | - The proportion of total past due and credit-impaired customer loans to total customer loans increased from 2.23% to 3.10%[44] - Total loans classified as 'non-performing' (substandard, doubtful, loss) based on internal credit ratings increased from HKD 563 million to HKD 789 million[54] Note 17: Off-balance-sheet Exposures As of June 30, 2025, the Group's total contractual amount of contingent liabilities, commitments, and derivative instruments remained stable at approximately HKD 3.30 billion, with unconditionally cancellable commitments forming the largest portion at HKD 2.61 billion | Item | June 30, 2025 (Contractual Amount, HKD thousands) | December 31, 2024 (Contractual Amount, HKD thousands) | | :--- | :--- | :--- | | Contingent Liabilities and Commitments | 35,210 | 132,190 | | Derivatives Held for Trading | 547,292 | 744,108 | | Other Commitments | 2,714,337 | 2,422,395 | | Total | 3,296,839 | 3,298,693 | Management Discussion and Analysis Overview and Financial Review Despite a challenging economic environment in Hong Kong, the Group achieved a turnaround to a post-tax profit of HKD 2.6 million in H1 2025, driven by a 12.7% increase in net interest income and a 25.5% rise in non-interest income, though asset quality remains under pressure - The Group operated cautiously amidst a challenging environment characterized by slow economic recovery and rising business closures and bankruptcies[69] - The Group turned from a loss of HKD 34.5 million in the prior year to a profit of HKD 2.6 million[71] - Key drivers for improved performance included a HKD 59.8 million (+12.7%) increase in net interest income and a HKD 31.4 million (+25.5%) rise in non-interest income[71] Business Review The Group's core subsidiaries showed mixed performance, with Public Bank (Hong Kong) achieving loan and deposit growth and a profit turnaround despite a significant rise in impaired loans, while Public Finance experienced a sharp profit decline due to increased credit losses on unsecured personal loans Public Bank (Hong Kong) - Total customer loans grew by 2.9% to HKD 19.35 billion, and customer deposits increased by 4.1% to HKD 29.08 billion[76] - The ratio of impaired customer loans to total customer loans significantly increased from 1.95% to 3.02%[76] - A profit of HKD 38.4 million was recorded, compared to a loss of HKD 4.1 million in the prior year[76] Public Finance - Total customer loans decreased by 1.5% to HKD 5.11 billion, and customer deposits fell by 2.2% to HKD 4.18 billion[77] - Profit decreased by 69.1% to HKD 2 million, primarily due to increased credit loss expense on unsecured personal loans[77] Funding and Capital Management The Group maintains a robust funding and capital position, primarily relying on internal capital growth and customer deposits, with Public Bank (Hong Kong) Group's consolidated Common Equity Tier 1 and total capital ratios at 26.8% and 27.6% respectively, well above regulatory requirements - The Group primarily relies on internal capital growth, customer deposits, and deposits from financial institutions to fund its operations[83] - The asset-to-liability ratio (bank loans/equity) is at a healthy level of 0.20x[83] | Capital Adequacy Ratios (Public Bank (Hong Kong) Group) | June 30, 2025 | | :--- | :--- | | Consolidated Common Equity Tier 1 Capital Ratio | 26.8% | | Total Capital Ratio | 27.6% | Asset Quality and Credit Management The Group's asset quality is under pressure due to a challenging operating environment and weak asset prices, with the ratio of impaired customer loans to total customer loans increasing from 2.2% to 3.1%, necessitating continued prudent credit risk management - The ratio of impaired customer loans to total customer loans increased by 0.9 percentage points from 2.2% as of December 31, 2024, to 3.1% as of June 30, 2025[85] Outlook Management anticipates slow economic recovery with uncertain prospects due to geopolitical and trade issues, limiting loan growth, while the Group will pursue prudent capital and risk management, seek profitable loan growth, diversify income through fee-based businesses, and advance digital transformation - Slow economic recovery is anticipated, but the outlook remains highly uncertain due to geopolitical and international trade issues, which will limit loan growth[88] - Strategic priorities include: prudent capital and liquidity risk management; seeking profitable loan growth while managing funding costs; diversifying income through fee-based businesses like stockbroking and insurance; and advancing digital transformation to enhance efficiency, such as launching an upgraded mobile banking application[88][89] - The Group has set sustainability goals: achieving Scope 1 and Scope 2 carbon neutrality by 2030, and net-zero carbon emissions by 2050[89] Corporate Governance and Other Information Corporate Governance and Audit Committee Review The company confirmed compliance with the Corporate Governance Code during the reporting period, and the unaudited interim results were reviewed by the Audit Committee, comprising three independent non-executive directors and two non-executive directors - During the reporting period, neither the company nor its subsidiaries purchased, sold, or redeemed any of the company's listed shares[91] - The Board confirmed compliance with the Corporate Governance Code as set out in Appendix C1 of the Listing Rules[92] - These interim results have been reviewed by the Audit Committee[93]