Investment Rating - The report maintains an "Overweight" rating for the company [1] Core Views - The company reported a Q1 2025 revenue of 212.77 billion yuan, a decrease of 3.22% year-on-year, and a net profit attributable to shareholders of 84.16 billion yuan, down 3.99% year-on-year [2] - Total assets at the end of Q1 stood at 51.55 trillion yuan, reflecting an increase of 8.29% year-on-year, with a non-performing loan ratio of 1.33%, down 1 basis point quarter-on-quarter [2] - The net interest margin for Q1 was 1.33%, a decline of 15 basis points year-on-year [2] Summary by Sections Financial Performance - Q1 2025 revenue decreased by 3.22% year-on-year to 2127.74 billion yuan, with net profit down 3.99% to 841.56 billion yuan [2] - Total assets increased by 8.29% year-on-year to 51.55 trillion yuan, with a non-performing loan ratio of 1.33% [2] Loan and Deposit Growth - Government financing has driven growth in investment assets, while loan growth has slightly slowed due to demand factors [6] - Deposit growth has shown a slight recovery, influenced by macroeconomic policies [6] Interest Margin and Income - The net interest margin for Q1 was 1.33%, reflecting a decline due to repricing effects [6] - Fee and commission income has seen a narrowing decline, with potential for recovery in the upcoming quarters [6] Asset Quality - The overall asset quality remains stable, with a non-performing loan ratio of 1.33% at the end of 2024 [7] - Individual loan risks are expected to be manageable, supported by a solid customer base and prudent risk management [7] Earnings Forecast and Investment Recommendation - The company is expected to maintain stable operations despite rising pressures, with projected revenues of 817.5 billion yuan, 833 billion yuan, and 880.2 billion yuan for 2025, 2026, and 2027 respectively [8] - The report maintains an "Overweight" rating based on the company's strong customer base, diversified business, and stable dividend policy [8]

"过去一个时期的金融风险，让我们对风险形势更清楚了，对风险的表现形态和传染路径更了解了，我 们管控好风险更加心中有数。"3月28日，在2024年度业绩说明会上，兴业银行董事长吕家进如是表示。 在财报中，他同样强调道，"危机不能浪费，学费不能白交，我们要从经历过的风险中重新检视风险管 理理念和机制"。 近日，兴业银行交上了一份去年营收和净利润"双增"的成绩单，但是与业绩高光时刻相比，无论是增速 还是净利润额，都仍有提升空间。 又到一年金融业财报季，除了继续深入观察数据背后机构发展趋势外，2025年，南都湾财社将聚焦业绩 发布会上的高管众生相，旨在观察高管带领下机构发展的新机遇。 系列观察首篇聚焦兴业银行。作为股份行中的头部银行，兴业银行近年来稳中求进，其业绩走势、面临 的挑战，以及解决问题的策略与路径，对行业都具有一定的参照价值。 "学费不能白交" 3月28日，兴业银行举行2024年度业绩说明会。吕家进在致辞中表示，过去一个时期国家出台的系列增 量政策尤其是房地产化险政策、地方政府融资化债政策，已经开始显现成效，一些地区市场价格开始止 跌回稳，市场情绪开始复苏回暖，对我们重点领域的风险管控形成利好，风险逐步在收 ...

Core Viewpoint - The recent financial risks have provided clearer insights into risk management, prompting the bank to reassess its risk management philosophy and mechanisms, emphasizing the importance of learning from past experiences [1][2][3] Financial Performance - In the 2023 financial report, the bank reported a revenue of 212.23 billion yuan, a year-on-year increase of 0.66%, and a net profit of 77.21 billion yuan, up 0.12% [3][4] - The net interest margin and net interest spread decreased by 0.10 and 0.11 percentage points to 1.56% and 1.82%, respectively [3] - The non-performing loan (NPL) ratio remained stable at 1.07%, while the provision coverage ratio decreased by 7.43 percentage points to 237.78% [4] Risk Management - The bank's risk management strategy includes strengthening compliance and internal control, optimizing the risk management system, and enhancing proactive risk prevention measures [3][9] - The bank has established agile teams to address risks in key areas such as real estate and local government financing, aiming to improve decision-making efficiency and asset quality [9][19] - The bank's loan impairment losses increased significantly, with a total of 61.18 billion yuan in 2023, reflecting a proactive approach to identifying potential risks [6][19] Loan Quality - The overall NPL ratio has decreased from 1.25% in 2020 to 1.07% in 2024, although the balance of special mention loans increased to 98.11 billion yuan, indicating some pressure in key sectors [8][10] - The bank's credit card NPL ratio has shown a downward trend, decreasing from 4.01% in 2022 to 3.64% in 2024 [9][10] Strategic Focus for 2025 - The bank aims to maintain a "steady progress" approach, focusing on expanding low-cost deposits and enhancing its fee-based income [15][16] - Digital transformation is a priority, with plans to leverage technology to improve operational efficiency and customer experience [18][19] - The bank is committed to long-termism and aims to navigate through economic cycles by enhancing its risk management and operational frameworks [20]

Core Viewpoint - China Merchants Bank aims to maintain a return on equity (ROE) above 15%, although it acknowledges that this is contingent on external operating environment changes. The bank's ROE has recently fallen below this threshold due to industry pressures, but it remains confident in outperforming peer banks in this metric [1][3][4]. Financial Performance - For the year 2024, China Merchants Bank reported total operating income of 337.49 billion yuan, a year-on-year decrease of 0.48%. The net profit attributable to shareholders was 148.39 billion yuan, reflecting a year-on-year increase of 1.22%. As of the end of 2024, total assets reached 12.15 trillion yuan, marking a growth of 10.19% compared to the previous year [1]. Shareholder Returns - The bank plans to distribute a cash dividend of 2 yuan per share (before tax) to all shareholders, amounting to approximately 50.44 billion yuan in total dividends. The cash dividend payout ratio for 2024 is set at 35.32%, which is higher than the previous years' ratios of 33% in 2022 and 35.01% in 2023 [2]. ROE and Competitive Position - The bank's management expressed confidence in maintaining a leading ROE compared to peer banks, driven by its net interest margin and advantages in wealth management. Despite challenges from low interest rates and fees, the bank believes its competitive edge will help sustain its ROE [3][4]. Asset Quality Management - The bank emphasizes the importance of managing retail credit risk, focusing on optimizing risk management models and selecting high-quality customer segments. The management anticipates that as the economic situation improves, the quality of retail credit assets will stabilize [5]. Customer Growth Strategy - China Merchants Bank is focusing on expanding its customer base, particularly among university students and young clients, as well as enhancing services for families and cross-border clients. The retail customer base reached 210 million, while corporate clients numbered 3.1664 million, indicating solid growth [7]. Non-Interest Income - The bank aims to stabilize and recover its fee and commission income, which has faced pressure in recent years. The management noted that while there was negative growth in this area last year, the decline has been narrowing. They expect a recovery in non-interest income driven by favorable macroeconomic policies [8][9]. AI Investment - China Merchants Bank has significantly increased its investment in AI technologies, establishing an AI laboratory in 2017 and forming an "AI + Finance" working group in response to advancements in AI. The bank aims to become a leader in intelligent banking [10]. Capital Management and Dividends - The bank maintains a cautious approach to balancing capital adequacy and shareholder returns, emphasizing the importance of stable cash dividends for long-term value creation. The management is committed to ensuring that dividend policies do not fluctuate significantly year-on-year [11]. Market Value Management - The bank's management believes that effective operational management and enhanced profitability are crucial for market value management. They aim to strengthen their capabilities in profitability, risk management, and innovation to create value for stakeholders [12].