Minsheng Securities·2024-09-01 07:30Investment Rating - The report maintains a "Recommended" rating for the company [2][3]. Core Views - The bank's investment income has shown a remarkable increase of 71% year-on-year, significantly supporting revenue growth. However, net interest income and commission income are under pressure due to narrowing interest margins and weak retail demand. In the medium to long term, this situation may provide better elasticity for future performance [2]. - The bank's net interest margin (NIM) is expected to improve in the second half of the year due to a reduction in deposit pricing, which is gradually becoming evident [2]. - The bank's total assets, loan amounts, and deposits have shown year-on-year growth rates of +0.6%, +4.0%, and -6.0%, respectively, indicating a slowdown in deposit growth which may hinder asset expansion [1][2]. Summary by Sections Financial Performance - In the first half of 2024, the bank achieved a total revenue of 69.8 billion yuan, a year-on-year decrease of 8.8%. The net profit attributable to shareholders was 24.5 billion yuan, reflecting a year-on-year increase of 1.7% [1]. - The bank's non-performing loan ratio remained stable at 1.25%, with a provision coverage ratio of 172% [1]. Revenue Breakdown - The bank's net interest income, commission income, and other non-interest income experienced year-on-year changes of -12.1%, -21.7%, and +33.8%, respectively. The growth rate of other non-interest income was primarily driven by significant investment gains from the disposal of financial assets [1]. Future Earnings Projections - The projected earnings per share (EPS) for 2024, 2025, and 2026 are 0.70 yuan, 0.71 yuan, and 0.74 yuan, respectively. The closing price on August 30, 2024, corresponds to 0.4 times the 2024 price-to-book (PB) ratio [2][3].