Changshu Bank(601128) 华创证券·2024-08-21 09:10Investment Rating - The report maintains a "Recommended" rating for Changshu Bank, with a target price of 7.82 CNY based on a projected price-to-book (PB) ratio of 0.85X for 2024 [1][3]. Core Views - Changshu Bank's revenue and profit growth remain strong, with a 12.03% year-on-year increase in revenue to 5.506 billion CNY and a 19.58% increase in net profit to 1.734 billion CNY in the first half of 2024 [1][3]. - The bank's non-performing loan (NPL) ratio remains stable at 0.76%, with a provision coverage ratio of 538.8%, indicating solid asset quality [1][3]. - The bank's net interest margin (NIM) decline has slowed, with a year-on-year decrease of 19 basis points to 2.67% in Q2 2024, primarily due to a reduction in funding costs [1][3]. Financial Performance Summary - For the first half of 2024, Changshu Bank achieved total operating income of 5.506 billion CNY, a 12.03% increase year-on-year, and a net profit attributable to shareholders of 1.734 billion CNY, reflecting a 19.58% growth [1][3]. - The bank's non-interest income grew by 56.2% year-on-year, contributing positively to revenue growth [1]. - The bank's loan balance increased by 11.3% year-on-year, with total new loans of 18.727 billion CNY in the first half of 2024 [1][3]. Asset Quality and Risk Management - The NPL ratio remains at 0.76%, with a slight increase in the net generation rate of NPLs and attention rates in Q2 2024 [1][3]. - The bank has increased its provisioning efforts, with a year-on-year increase of 35.4% in provisions for Q2 2024 [1][3]. - The bank's risk compensation ability remains strong, with a high provision coverage ratio of 538.8% [1][3]. Future Outlook - The report forecasts revenue growth rates of 11.4%, 12.4%, and 13.7% for 2024, 2025, and 2026, respectively, and net profit growth rates of 17.2%, 19.9%, and 19.4% for the same years [1][3][4]. - The bank's business model focuses on small and micro enterprises, which is expected to drive long-term growth [1][3].