Changjiang Securities·2025-10-31 05:12Investment Rating - The report maintains a "Buy" rating for Qingdao Bank [9]. Core Insights - Qingdao Bank's revenue growth for the first three quarters is 5.0%, while net profit attributable to shareholders grows at 15.5%, indicating sustained high profit growth. Net interest income increases by 12.0%, primarily driven by rapid credit expansion. Non-interest income declines by 10.7%, mainly due to a weak bond market in the third quarter. Total assets grow by 11.0% compared to the beginning of the year, with loans increasing by 10.2%, and corporate loans rising significantly by 14.6% [2][6]. Summary by Relevant Sections Performance - Interest income remains robust, with net interest income up 12.0% year-on-year. The third quarter shows a high growth of 11.6%. Non-interest income declines by 10.7%, largely due to weak bond market performance, with investment income and other non-interest income down 15.5%. The cost-to-income ratio and tax expenses have decreased significantly, supporting high profit growth [2][6][12]. Scale - The asset-liability structure is improving, with total assets increasing by 11.0% and loans by 10.2% year-to-date. Corporate credit has surged by 14.6%, primarily directed towards manufacturing and retail sectors. Retail loans have decreased by 4.6% due to a strategic tightening of credit standards. Overall, credit growth is expected to stabilize around 11% for the year, mainly driven by corporate lending [2][6][12]. Interest Margin - The focus is on enhancing efficiency, with net interest margin significantly outperforming peers since 2023. The third quarter's net interest margin decreased by 5 basis points to 1.68%. The yield on loans is expected to remain in a downward trend, with the average yield on interest-earning assets dropping by 9 basis points to 3.55% [2][6][12]. Asset Quality - Loan quality is steadily improving, reaching the best level since the bank's listing. The non-performing loan ratio decreased to 1.10%, down 2 basis points from the previous quarter and 4 basis points from the beginning of the year. The coverage ratio for provisions has significantly improved to 270%, up 17 percentage points [2][6][12]. Investment Recommendation - The report highlights sustained high profit growth and steady improvement in asset quality, validating the logic of enhancing quality and efficiency in the bank's three-year strategic plan. The major shareholder, Guoxin Group, plans to significantly increase its stake, reflecting strong confidence in the bank's long-term value. Current valuations indicate significant room for recovery, with PB ratios at 0.72x/0.56x and PE ratios at 6.2x/4.8x [2][6][12].