Core Viewpoint - Qilu Bank reported a net profit growth of 16.48% year-on-year for the first half of 2025, indicating strong financial performance [1] Financial Performance - The bank achieved an operating income of 6.782 billion yuan, representing a year-on-year increase of 5.76% [1] - The net profit attributable to shareholders of the listed company was 2.734 billion yuan, reflecting a growth of 16.48% compared to the previous year [1]

Investment Rating - The report maintains a "Strong Buy" rating for Hangzhou Bank [3] Core Views - Hangzhou Bank's performance continues to show high growth, with a revenue increase of 3.9% in the first half of 2025 and a net profit growth of 16.7% [6] - The bank's asset quality remains excellent, with a non-performing loan ratio of 0.76% and a provision coverage ratio of 520.89% [6] - The conversion of convertible bonds has effectively supplemented the bank's capital, which is expected to enhance future growth potential [6] Financial Data and Valuation - Total revenue (in million) for 2023 is projected at 35,016, with a year-on-year growth of 6.3% [2] - Operating profit for 2023 is estimated at 16,287 million, reflecting a year-on-year growth of 25.3% [2] - Net profit attributable to shareholders for 2023 is expected to be 14,383 million, with a year-on-year growth of 23.2% [2] - Earnings per share (EPS) for 2023 is projected at 2.31, with a price-to-earnings (PE) ratio of 7.3 [2] - The bank's return on equity (ROE) is reported at 12.2% [3] Performance Metrics - Loan growth for the first half of 2025 is at 12.0%, while deposit growth is at 16.2% [6] - The bank's total assets have shown a year-on-year growth of 15.9% [8] - The bank's capital adequacy ratio is projected to improve post-conversion of convertible bonds, enhancing its growth capacity [6] Investment Recommendation - Hangzhou Bank is positioned as a high-growth bank with strong fundamentals and excellent asset quality, making it a suitable candidate for long-term value investment [6]

Investment Rating - The report maintains a "Buy" rating for Suzhou Bank, with an adjusted target valuation set at 1 times PB for 2025 [8]. Core Views - The report emphasizes the strong regional presence, substantial provisions, and excellent performance characteristics of Suzhou Bank, highlighting the significant shareholding increase by the major shareholder, Guofa Group, as a key catalyst for investment [8]. - The report notes that Guofa Group has increased its stake to approximately 14.6% and has completed a share buyback plan exceeding the lower limit, indicating confidence in the bank's long-term growth potential [6][8]. - The expected improvement in mid-year revenue performance and the bank's ability to maintain a leading position in profit growth within the industry are also highlighted [8]. Financial Data and Profit Forecast - Total operating income is projected to grow from 11,866.12 million in 2023 to 14,377.10 million by 2027, with a compound annual growth rate (CAGR) of approximately 7.17% [7]. - The net profit attributable to shareholders is expected to increase from 4,600.65 million in 2023 to 6,353.92 million in 2027, reflecting a growth rate of 8.29% by 2027 [7]. - The report anticipates a decrease in asset impairment losses from 1,647.96 million in 2023 to 2,223.63 million by 2027, indicating improved asset quality [7]. - The non-performing loan (NPL) ratio is projected to remain stable at around 0.82% from 2025 to 2027, with a high provision coverage ratio of over 420% expected to be maintained [7][8]. Shareholder Activity - Guofa Group has increased its holdings in Suzhou Bank four times since September 2024, accumulating a total of 2.2 billion shares for nearly 17 billion, demonstrating strong confidence in the bank's future [9]. - Following the approval of shareholder qualifications, Guofa Group's maximum holding limit has increased to 20%, allowing for further potential share purchases [8][9]. Valuation Comparison - As of June 26, 2025, Suzhou Bank's closing price is 9.13 yuan, with a market capitalization of 40,071 million yuan and a price-to-book (P/B) ratio of 0.79, indicating an approximate 11% discount compared to comparable peers [8][13]. - The report suggests that the current stock price corresponds to a 2025 P/B of 0.79, with an expected dividend yield of around 4.0%, providing a potential upside of 27% [8].

Investment Rating - The report maintains a "Recommend" rating for Qilu Bank, indicating a positive outlook based on its growth potential and improving asset quality [10]. Core Views - Qilu Bank's revenue and net profit have shown consistent growth, with 2024 revenue increasing by 4.6% year-on-year and net profit rising by 17.8%. In Q1 2025, revenue grew by 4.7% and net profit by 16.5% [2][3]. - The bank's asset quality is improving, as evidenced by a decrease in the non-performing loan (NPL) ratio to 1.17% in Q1 2025, down 2 basis points from the previous quarter, and an increase in the provision coverage ratio to 324.1% [2][5][9]. - Qilu Bank is expanding its credit offerings, with loan growth rates of 12.6% for 2024 and 12.3% for Q1 2025, primarily driven by corporate loans [4][10]. Summary by Sections Financial Performance - In Q1 2025, Qilu Bank's net interest income increased by 7.9% year-on-year, contributing to stable revenue growth. Non-interest income also saw positive growth, with fees and commissions rising by 8.6% [3][4]. - The bank's dividend payout ratio increased to 27.62% for 2024, translating to a dividend yield of 4.22% based on the closing price on April 25, 2025 [3]. Asset Quality - The overall asset quality is on an upward trend, with the NPL ratio decreasing and the coverage ratio improving. The bank's NPL generation rate is relatively low compared to peers [5][9]. - Retail loan quality has shown some deterioration, with the NPL ratio rising to 2%, but this is considered a common trend across the industry [9]. Growth Prospects - Qilu Bank is expected to maintain high growth rates in net profit, with projections of 16.9%, 15.2%, and 14.9% for 2025 to 2027, respectively. The bank's book value per share (BVPS) is also projected to grow steadily [10][11]. - The bank's rapid expansion in credit and improving asset quality are anticipated to support sustained profitability [10].