Bank Of Jiangsu(600919) 长江证券·2025-05-04 08:18Investment Rating - The investment rating for Jiangsu Bank is "Buy" and is maintained [9]. Core Views - Jiangsu Bank's Q1 2025 revenue growth was 6.2%, with net profit growth of 8.2%. The significant increase in net interest income by 21.9% was attributed to stable interest margins and strong asset expansion. Total assets grew by 12.8% compared to the beginning of the year, with loans increasing by 8.0% and deposits rising by 14.2% [2][6]. Summary by Sections Financial Performance - In Q1 2025, Jiangsu Bank's net interest income increased by 21.9%, leading to an unexpected revenue growth. Non-interest income decreased by 22.7% year-on-year due to a high base last year, but fee income grew by 21.8%. Investment income and other non-interest revenues declined by 32.7% due to market fluctuations and last year's high base [11][12]. Scale and Growth - The bank demonstrated strong deposit-taking capabilities, with total assets increasing by 12.8% in Q1 2025. Loans grew by 8.0%, with corporate loans increasing by 13.5%. Deposits rose by 14.2%, with corporate deposits growing by 14.4%. The bank expects to maintain a loan growth rate of over 10% for the year [11][12]. Interest Margin - The cost of liabilities is improving rapidly, alleviating pressure on interest margins. The interest margin is expected to stabilize and rise compared to the 2024 annual rate of 1.86%. The bank's focus on high-yield quality projects and the absence of interest rate cuts from policymakers are supporting asset yield [11][12]. Asset Quality - The bank's asset quality indicators improved, with the non-performing loan (NPL) ratio decreasing by 3 basis points to 0.86% at the end of Q1 2025. The coverage ratio slightly declined but remains robust at 344%. The bank is closely monitoring retail risk changes due to rising retail sector risks [11][12]. Investment Recommendation - Jiangsu Bank offers a high dividend yield of 5.3%, which is among the highest in the sector, and is currently undervalued with a price-to-book ratio of 0.74x. The bank's stable dividend payout ratio of 30% of net profit is expected to continue, making it a strong investment recommendation [11][12].