Changjiang Securities·2024-09-02 07:42Investment Rating - The investment rating for the specific company is "Buy" and is maintained [5]. Core Views - The company reported a 3.5% year-on-year decline in operating income for the first half of 2024, while net profit attributable to shareholders decreased by 1.6%. However, net interest income grew by 2.2%, indicating resilience in a challenging environment [2][6]. - The net interest margin improved to 1.29%, up 2 basis points from the first quarter, benefiting from a reduction in deposit costs. The cost of deposits decreased by 12 basis points compared to the full year of 2023 [2][6]. - The non-performing loan ratio remained stable at 1.32%, with a provision coverage ratio of 205%, reflecting an 8 percentage point increase [2][6]. Summary by Sections Financial Performance - Operating income decreased by 3.5% year-on-year, while net profit attributable to shareholders fell by 1.6%. Net interest income showed a positive growth of 2.2% [2][6]. - The loan growth rate was 3.9% in the first half, with a quarter-on-quarter increase of 0.8% in the second quarter. Retail loans saw a quarter-on-quarter growth of 2.2% [6][7]. Interest Margin and Costs - The net interest margin rose to 1.29%, supported by a significant improvement in deposit costs. The cost of deposits decreased by 12 basis points compared to the previous year [2][6]. - The yield on loans decreased by 22 basis points compared to 2023, with corporate and retail loan yields dropping by 18 and 30 basis points, respectively [6][7]. Asset Quality - The non-performing loan ratio remained stable at 1.32%, with a net generation rate of non-performing loans at 0.49%, slightly down from the previous year [7]. - The provision coverage ratio increased to 205%, marking a significant improvement in risk mitigation capabilities [7]. Dividends and Future Outlook - The company announced a mid-year dividend payout ratio of 32%, consistent with the previous year, indicating stable dividend capacity [6][7]. - The forecast for 2024 anticipates a 0.3% year-on-year growth in revenue and a 0.6% increase in net profit attributable to shareholders [7].