China Merchants Bank 3968

[winston]

not vested

China Merchants Bank (3968 HK/600036 CH): <Earnings First Take> FY21 results in line [BUY, TP HK$87.70/BUY, TP RMB81.50]

Net profit increased by 23.2% y-o-y to c.Rmb 120bn

FY21 NIM was 2.48%, a 1bp y-o-y drop or 1bp q-o-q increase.

FY21 NPL ratio was 0.91%, representing 16bps y-o-y drop or 2bps q-o-q drop.

With over 20% y-o-y profit growth and 16.96% ROE in FY21, CMB maintains its leading position in China banks.

We have BUY with TP at HK$ 87.7 on the counter.

Source: DBS

[winston]

not vested

CMB: Banking Sector Sees Fierce Deposit Competition; CN Property Risk Still Amid Rising This Yr

Wang Liang, Executive Vice President and Chief Financial Officer of CM BANK (03968.HK) expressed that the deposit competition among the banking sector has been fierce, after the People's Bank of China lowered the policy interest rate in December 2021, which led to the reduction in the banks' loan interest rates.

Wang, nonetheless, remained optimistic in China achieving the target of 5.5% economic growth throughout this year, believing that the bank loans will be able to maintain previous growth rate on the back of the stronger fiscal and monetary support from the government.

Related News: CM BANK 2021 NP Up 23.2% YoY to RMB119.92B; DPS RMB1.522

Zhu Jiangtao, the bank's Chief Risk Officer, on the other hand, predicted that the risks associated with the Chinese property sector will likely further expand this year, with potential further increase in the NPL ratio.

As for EVERGRANDE (03333.HK), CM BANK will maintain communication with project managers, and will speed up product risk disposal and safeguard investor rights.

Source: AAStocks Financial News

[winston]

not vested

Brokers│Views

CICC│2021 result outstanding, shows mid- to long-term strategy execution thinking, mindset reform

Nomura│4Q21 result solid

JPMorgan│QoQ result beats but asset quality mixed

Morgan Stanley│a quarter of very stable result

Credit Suisse│2021 NIM down 1 bp YoY only, more resilient than forecast

CCB International│strategy blueprint executed strongly

Goldman Sachs│NII beats

UBS│QoQ core profit, ROE breathtaking

Citigroup│QoQ result solid thanks to NIS, fee income

CITIC Securities│2021 result outstanding; client-centric view brings sustainable value

BofA Securities│result in-line, but sees better options among banks

Related News: C Suisse Adds CM BANK (03968.HK) TP to $80, Rated Outperform

Source: AAStocks Financial News

[winston]

not vested

China Merchants Bank battles difficult quarter

China Merchants Bank (3968) said the first quarter is the most difficult quarter of the year amid the latest Covid outbreak and the capital market's volatility

Also, its bad loan rate in the real estate sector is expected to continue to rise this year as the risks of the property market are still rising, the Chinese lender said in the media briefing yesterday.

The bank posted a 23.2 percent growth in net profit last year to 119.92 billion yuan (HK$147.68 billion), driven by growth in net interest income and net fee and commission income.

It proposed a dividend of 1.52 yuan per share, an increase of 21.46 percent year-on-year.

Its net interest income rose by 10.21 percent to 203.92 billion yuan last year, mainly driven by an increase in total loans and advances.

Net fee and commission income amounted to 94.45 billion yuan for the same period, representing a year-on-year increase of 18.82 percent. Among them, fee and commission income from wealth management business amounted to 35.84 billion, up 29 percent from an earlier year.

As of the end of last year, the bank's bad loan ratio, or non-performing loan ratio, declined 0.16 basis points to 0.91 percent, the first time to fall below 1 percent since 2013.

However, the amount of non-performing loans in the real estate sector increased to 5.655 billion yuan from 1.19 billion at the end of 2020, with the non-performing loan ratio in the sector increased by 1.11 percentage points to 1.41 percent by the end of last year.

The lender saw its total assets enlarged by 10.6 percent to 9.25 trillion yuan as of the end of last year.

Source: The Standard

https://www.thestandard.com.hk/section- ... lt-quarter

[winston]

not vested

China Merchants Bank
Returning to a trend of rising ROEs

FY21 net profit growth was 21.5% yoy, the strongest in nine years.

Provisioning buffers continue to build, with 4Q21’s provisioning coverage ratio of 484%
a record high and well above the 120% regulatory minimum.

Interestingly, 4Q21 credit card NPL formation rates worsened qoq (Fig 6) and may have led to CMB slowing its credit card loan growth (Fig 4).

Remains our top sector pick. Reiterate Add rating; Slight TP cut to HK$84.1.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 9A8B164BE7

[winston]

China Merchants Bank (3968 HK)
2021: Results In Line; Expect 2022 NIM To Outperform Peers’

CMB’s net profit grew 23.2% yoy, with strong non-interest income, in line with our
expectations.

NIM compression was also in line.

The bank’s strong retail banking business and solid asset quality support its trading at a premium to other banks.

CMB’s NIM is expected to outperform peers’ due to its low deposit cost strategy.

Maintain BUY on CMB and raise target price to HK$82.90.

Source: UOBKH

https://research.uobkayhian.com/content ... 7ef32bbb09

[winston]

China Merchants Bank relieves president Tian Huiyu of his job in surprise move after US$11 billion stock sell-off amid talk of unspecified probes

Tian was relieved of his job with immediate effect, China Merchants Bank said, adding that he would be assigned to another unspecified post

Chief financial officer Wang Liang to step up as interim CEO, the bank said

by Zhang Shidong

Source: SCMP

https://www.scmp.com/business/banking-f ... 19e84db513

[winston]

vested

Unexpected change of president

CMB board of directors unexpectedly announced, effective immediately, Mr Tian Huiyu is no longer its president, with its CFO now the interim president.

No official reason for the change was provided. CMB’s A-share price fell 7% on the date of the announcement (18 Apr; HK’s share market was closed).

Mr Tian was highly regarded by investors, with CMB beating the MSCI China index every year since he became its president in Sep 2013.

Reiterate Add. Remove CMB from our High Conviction list as uncertainty about this change could weigh on its share price.

TP unchanged at HK$84.1.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 4CC679FA69

[winston]

Tian Huiyu To Serve China Merchants Finance Biz Group after Being Removed as CMB President: Report

Tian Huiyu, who was removed by CM BANK (03968.HK) as the President and the Director of the Bank, will act as the Deputy Director (Executive) of China Merchants Finance Business Group/ Platform Executive Committee, as well as the Vice Chairman (Group Assistant General Manager) of China Merchants Finance Holdings Company Limited, Cailian Press reported.

Source: AAStocks Financial News

[winston]

not vested

When reaction becomes overreaction

We believe CMB’s H-share price fall of 16% over two days is an overreaction based on our share price analysis of similar past events at other institutions.

This Friday’s 1Q22 results and next Monday’s analyst briefing are great opportunities to clear up lingering uncertainty surrounding the stock.

We see CMB as a bank with many strengths, and believe it is capable of continuing to outperform despite the departure of its previous president.

Reiterate CMB as our top China bank pick. We continue to expect ROE to rise over FY21–FY24F. Unchanged Add rating and TP of HK$84.1.

Source: CIMB

https://rfs.cgs-cimb.com/api/download?f ... 657AEA4108