Changjiang Securities·2024-05-07 08:32Investment Rating - The investment rating for Postal Savings Bank is "Buy" and is maintained [4]. Core Views - The bank's revenue and interest income have shown resilient growth, making it the only major bank with positive growth amidst industry challenges. The net interest income growth reached 3.1% in the first quarter, supported by a relatively stable net interest margin compared to peers [5][6]. - The bank's asset quality remains stable, with a non-performing loan (NPL) ratio of 0.84% at the end of the first quarter, reflecting a slight increase but still among the best in the retail banking sector. The provision coverage ratio stands at 327%, indicating strong risk management [5][6]. - Future performance is expected to improve as the retail market stabilizes, and adjustments in agency fee rates and net interest margins take effect. The bank is projected to achieve a revenue growth rate of 0.6% and a net profit growth rate of 0.7% in 2024 [6]. Summary by Sections Revenue and Profitability - In the first quarter, the bank's revenue grew by 1.4% year-on-year, while net profit decreased by 1.3%. The decline in net profit is attributed to a special adjustment in postal savings agency fees, which is expected to ease in the future [5][6]. - Non-interest income fell by 4.8%, primarily due to an 18.2% drop in fees, influenced by reduced insurance agency fees. However, other non-interest income sources grew by 16.7%, indicating a high-quality revenue growth [5]. Loan and Deposit Growth - The bank's total loans increased by 4.6% compared to the beginning of the year, with general loans (excluding bills) growing by 5.7%. Corporate loans rose by 8.3%, while retail loans increased by 3.8% [5][6]. - Deposits also grew by 4.8%, with expectations for an increase in the loan-to-deposit ratio, which will enhance profitability [5]. Net Interest Margin and Cost of Deposits - The net interest margin for the first quarter was 1.92%, down 17 basis points year-on-year, but the decline was less than that of peers. The cost of interest-bearing liabilities decreased by 5 basis points compared to the previous year, indicating an ongoing improvement in deposit costs [5][6]. Asset Quality - The bank's NPL ratio remains low at 0.84%, with a marginal increase of 1 basis point. The new NPL generation rate decreased by 4 basis points to 0.81%, showcasing strong asset quality management [6]. - The bank's real estate loan NPL ratio is the lowest among major banks at 2.45%, reflecting a robust position in managing real estate-related risks [6]. Investment Outlook - The bank is expected to see a gradual recovery in performance, supported by a stable retail market and adjustments in fee structures. The stock's dividend yield is attractive at 5.41%, with a price-to-earnings ratio of 5.9x for 2024 [6].