Bank Of Jiangsu(600919) 民生证券·2024-08-17 03:00Investment Rating - Maintains a "Recommend" rating with a target price of 7.67 RMB, corresponding to 0.6x 2024 PB [2][3] Core Views - Jiangsu Bank achieved a 7.2% YoY growth in revenue and a 10.1% YoY increase in net profit attributable to shareholders in H1 2024, with a stable NPL ratio of 0.89% and a provision coverage ratio of 357% [1] - Net interest income, fee income, and other non-interest income grew by 1.8%, 11.3%, and 22.3% YoY respectively in H1 2024, with fee income growth rebounding significantly [1] - Corporate loans expanded steadily, with corporate loan balance increasing by 17.8% compared to the beginning of the year, while personal loans and bill discounts decreased by 2.8% and 14.5% respectively [1] - The net interest margin (NIM) narrowed by 8BP to 1.90% in H1 2024, with deposit costs declining significantly, contributing to a reduction in the NIM contraction [1] - Asset quality remained stable, with the NPL ratio unchanged at 0.89% compared to the end of 2023, while corporate asset quality improved, particularly in the leasing and business services and manufacturing sectors [1] Financial Performance Summary - Revenue for H1 2024 reached 41.6 billion RMB, a 7.2% YoY increase, with net profit attributable to shareholders at 18.7 billion RMB, up 10.1% YoY [1] - Cost-to-income ratio rose to 22.4% in H1 2024, up 0.4 percentage points from Q1 2024, while asset impairment losses decreased by 6.3% YoY, supporting profit growth [1] - Total assets and liabilities grew by 14.5% and 13.8% YoY respectively in H1 2024, driven by corporate loan expansion [1] - The yield on interest-earning assets and loans declined to 4.21% and 4.98% respectively in H1 2024, while the cost of interest-bearing liabilities and deposits decreased to 2.29% and 2.18% respectively [1] Future Projections - EPS for 2024-2026 is projected to be 1.73, 1.90, and 2.10 RMB respectively, with a 10.1% YoY growth in net profit attributable to shareholders in 2024 [2][3] - Revenue growth is expected to be 7.6%, 7.9%, and 8.1% for 2024-2026, with net interest income growth of 5.8%, 6.5%, and 7.2% respectively [10] - The NIM is forecasted to decline to 1.56%, 1.46%, and 1.39% for 2024-2026, while the NPL ratio is expected to improve to 0.87%, 0.86%, and 0.83% respectively [10] Asset Quality and Capital Adequacy - The NPL ratio remained stable at 0.89% in H1 2024, with corporate asset quality improving, particularly in the leasing and business services and manufacturing sectors [1] - The provision coverage ratio stood at 357% at the end of H1 2024, down 32 percentage points from the end of 2023 but still at a favorable level [1] - The capital adequacy ratio is projected to decline from 13.31% in 2023 to 12.32%, 11.42%, and 10.61% in 2024-2026, while the core capital adequacy ratio is expected to decrease from 9.46% to 9.00%, 8.56%, and 8.14% respectively [10]