Ping An Securities·2024-04-30 04:10Investment Rating - The report maintains a "Recommended" rating for the company [27]. Core Views - The company reported a decline in revenue and net profit for Q1 2024, with operating income at 219.8 billion yuan, down 3.4% year-on-year, and net profit attributable to shareholders at 87.7 billion yuan, down 2.8% year-on-year [1][4]. - The company is expected to maintain stable earnings growth with projected EPS of 1.03, 1.07, and 1.12 yuan for 2024 to 2026, respectively, reflecting a year-on-year growth of 0.5%, 4.0%, and 5.3% [8][9]. - The bank's capital adequacy ratio improved, with the core Tier 1 capital adequacy ratio rising to 13.78% by the end of Q1 2024, benefiting from effective capital management [9]. Summary by Sections Financial Performance - Q1 2024 operating income was 219.8 billion yuan, a decrease of 3.4% year-on-year, while net profit attributable to shareholders was 87.7 billion yuan, down 2.8% year-on-year [1][4]. - The annualized return on equity (ROE) was 10.06% [1]. - The bank's total assets reached 47.6 trillion yuan, growing 6.49% from the beginning of the year, with loans and deposits increasing by 4.92% and 4.52%, respectively [1][5]. Revenue and Profitability - The decline in revenue was primarily due to a decrease in net interest income and fee income, which fell by 4.2% and 2.8% year-on-year, respectively [4]. - Other non-interest income showed positive growth of 2.2% year-on-year, contributing positively to overall revenue [4]. Cost Management - The bank maintained strong cost control, with business management expenses increasing only 0.6% year-on-year, while impairment provisions decreased by 7.6% year-on-year, alleviating some pressure on profitability [4]. Asset Quality - The non-performing loan (NPL) ratio remained stable at 1.36%, with a slight year-on-year decrease of 2 basis points [5]. - The provision coverage ratio and loan loss reserve ratio improved slightly, indicating stable provisioning levels [5]. Capital Adequacy and Dividends - The core Tier 1 capital adequacy ratio increased by 6 basis points to 13.78% as of Q1 2024 [9]. - The board approved a mid-year dividend plan, with a proposed payout not exceeding 30% of the bank's after-tax profit for the first half of 2024, indicating potential for increased dividend distribution in the future [9].