Huachuang Securities·2024-03-28 16:00Investment Rating - The report maintains a "Recommend" rating for Postal Savings Bank of China (601658) with a target price of 5.97 CNY, compared to the current price of 4.76 CNY [2][9]. Core Views - The bank's revenue growth is on an upward trend, supported by a solid foundation in wealth management. The total revenue for 2023 reached 342.51 billion CNY, reflecting a year-on-year increase of 2.25% [2][9]. - The net profit attributable to shareholders for 2023 was 86.27 billion CNY, showing a year-on-year growth of 1.23% [2][9]. - The bank's loan portfolio saw a significant increase, with total loans growing by 13.02% year-on-year, indicating robust expansion in both corporate and retail lending [3][9]. Summary by Sections Revenue and Profitability - In Q4 2023, the bank's revenue growth turned positive, with a quarter-on-quarter increase of 5.59%, driven by strong loan growth and favorable bond trading results [3]. - The annual net interest margin narrowed by 4 basis points to 2.01%, primarily due to declining yields on retail loans [3][10]. Loan Growth - The bank's total loan growth for the year was 13.02%, with corporate loans increasing by 16.25% and retail loans by 10.48% [3][9]. - The bank's focus on serving the agricultural and small micro-enterprise sectors is evident, with agricultural loans totaling 21.5 trillion CNY, accounting for over 25% of total loans [3][9]. Wealth Management and Non-Interest Income - Non-interest income saw a slight decline of 0.64% year-on-year, but excluding one-time factors, it grew by 12.05% [3][9]. - The bank's wealth management business continues to thrive, with a significant increase in the number of high-net-worth clients and total assets under management exceeding 15 trillion CNY [3][9]. Asset Quality - The overall asset quality remains stable, with a non-performing loan ratio slightly increasing to 0.83% [3][9]. - The bank's provision coverage ratio stands at 348%, indicating a strong buffer against potential loan losses [3][9]. Future Outlook - The report forecasts revenue growth rates of 3.15%, 6.01%, and 8.41% for 2024, 2025, and 2026, respectively, with net profit growth rates of 3.91%, 6.27%, and 8.88% for the same years [9][10].