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JP morgan 深度报告（50页）
• Solid earnings. We estimate 32% sector earnings growth in 2010, little
changed from our forecast 12M ago. This however is now within consensus
expectation (30%) too. However, upbeat NIM trends and guidance on asset
quality should help to improve confidence. We believe some banks (CMB, Citic
and SPDB) may deliver 50% or above yoy earnings in 1Q11, while others may
announce growth ranging from 20-40% yoy.
• Revenue upside from strong NIM trend. 1H11 has yet to see more positive
surprise in credit pricing. Meanwhile, higher market rates and obvious shifts
toward demand deposits in 4Q10 across the sector should further widen NIM.
While the degree of quarterly change varies, we see more NIM upside in
medium-sized banks in FY11.
• Positive development on LGFV to alleviate concern. 4Q10 is unlikely to
reflect large downgrades from LGFV reclassification. We believe 1H11 data
may also see only modest downgrades. The recent system data from CBRC (see
p6) provide comfort. Meanwhile, banks have made progress on getting more
secondary sources of repayment and collateral. Finally recognizing that its
LGFV guideline is not compliant with accounting practice, CBRC has allowed
some exceptions in actual 5-category classification.
• More street earnings upgrades to follow. We increase FY11 and FY12
earnings by an aggregate 5% and 7% respectively for 12 banks under coverage.
Revisions for CMB, Citic and SPDB were more significant. Our earnings are
now 8% above consensus for 2011 and 11% higher for 2012. We also upgrade
BoComm-H to OW.
• Near-term re-rating limited by market risk, but revival in earnings
confidence in 2H11 should be a catalyst. We see favorable risk-reward and
still see the sector generating a 30-35% 12M total return. Indeed, YTD the
sector’s relative outperformance vs. MSCI AP financials and MSCI China has
proved its downside protection given attractive valuations. We believe inflation
should peak in 2Q11, making re-rating opportunities obvious.
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