QILU BANK(601665) 长江证券·2024-07-24 10:01Investment Rating - The investment rating for Qilu Bank is "Buy" and is maintained [6]. Core Views - Qilu Bank reported a 5.5% year-on-year increase in operating income and a 17.0% increase in net profit attributable to shareholders for the first half of 2024 [4]. - The non-performing loan (NPL) ratio decreased by 1 basis point to 1.24%, while the provision coverage ratio improved to 309.25% [4]. - The bank's weighted average annualized return on equity (ROE) was 12.66%, reflecting a year-on-year increase of 0.03 percentage points [4]. - The bank's loan balance grew by 8.8% compared to the beginning of the period, with a quarter-on-quarter increase of 2.8% in the second quarter [4]. - The net interest margin for 2023 was 1.74%, positioning Qilu Bank in the upper tier among city commercial banks [4]. - The bank's asset quality continues to improve, with the NPL ratio declining for several consecutive years and the credit cost ratio decreasing by 20 basis points year-on-year to 1.33% [4]. Summary by Sections Financial Performance - Operating income for the first half of 2024 increased by 5.5% year-on-year, while net profit attributable to shareholders rose by 17.0% [4]. - The bank's loan balance as of June increased by 8.8% from the beginning of the year, with deposits growing by 6.3% [4]. Asset Quality - The NPL ratio decreased to 1.24%, and the provision coverage ratio increased to 309.25% [4][10]. - The NPL net generation rate for 2023 was 0.81%, down 4 basis points from the previous year, indicating a good level of asset quality [4]. Growth Drivers - The bank's growth is expected to be driven by public and inclusive finance, with personal loan growth also outpacing the industry [4]. - The bank's net interest margin is expected to remain resilient, supported by a favorable funding cost [4]. Investment Outlook - The forecast for 2024 indicates a revenue growth rate of 5.2% and a net profit growth rate of 13.0% [5]. - Based on the closing price on July 22, 2024, the bank's price-to-book (PB) ratio is estimated at 0.56X, supporting a "Buy" rating due to long-term growth potential [5].