HZBank(SH:600926) Minsheng Securities·2024-08-29 06:30Investment Rating - The report maintains a "Recommended" rating for Hangzhou Bank, with a closing price of 13.26 yuan on August 28, 2024, corresponding to 0.7 times the estimated price-to-book (PB) ratio for 2024 [2][3]. Core Views - Hangzhou Bank has shown robust growth in scale and excellent asset quality, with a non-performing loan (NPL) ratio of 0.76% and a provision coverage ratio of 545% [1][2]. - The bank's revenue for the first half of 2024 reached 19.3 billion yuan, reflecting a year-on-year growth of 5.4%, while net profit attributable to shareholders was 10.0 billion yuan, up 20.1% year-on-year [1]. - The bank's net interest income has rebounded, with a growth rate of 0.5% in H1 2024, and other non-interest income has continued to grow rapidly at 28.3% [1]. Summary by Sections Financial Performance - In H1 2024, Hangzhou Bank's total assets, total loans, and total deposits grew by 13.8%, 16.5%, and 13.7% year-on-year, respectively [1]. - The bank's cost-to-income ratio remained low at 24.7% at the end of H1 2024, and asset impairment losses decreased by 26.0% year-on-year [1][2]. Asset Quality - The NPL ratio has remained stable at 0.76% for six consecutive quarters, with a slight decrease in corporate loan NPLs and a minor increase in personal loan NPLs [1]. - The bank's attention and overdue rates were 0.53% and 0.70%, respectively, indicating a relatively low level of asset quality concerns [1]. Future Projections - The report forecasts earnings per share (EPS) for 2024, 2025, and 2026 to be 2.89 yuan, 3.32 yuan, and 3.76 yuan, respectively, with a projected growth rate of 19.2% for 2024 [2][3]. - The bank's net interest margin (NIM) is expected to decline gradually from 1.36% in 2023 to 1.11% by 2026, reflecting ongoing pressure on interest rates [27].