发帖
雷达卡
20 January 2009
China Banks 2009 Outlook
Theme: Earnings deceleration
vs. credit loss acceleration
Lucy Feng
Research Analyst
(852) 2203 6251
lucy.feng@db.com
David Chung
Research Associate
(852) 2203 6136
david-hk.chung@db.com
Earnings slow down, strong balance sheets intact; look for defensive players
We expect the Chinese banking sector to experience severe setbacks during this
downcycle, as we forecast significant earnings growth constraints and margin
contractions for the banks under our coverage. Chinese banks still have strong
balance sheets with sufficient levels of provision coverage and capital adequacy
on average; among these, we expect banks with the most defensive structure to
better weather the current economic downturn.
Deutsche Bank AG/Hong Kong
All prices are those current at the end of the previous trading session unless otherwise indicated. Prices are sourced from local
exchanges via Reuters, Bloomberg and other vendors. Data is sourced from Deutsche Bank and subject companies. Deutsche
Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm
may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single
factor in making their investment decision. Independent, third-party research (IR) on certain companies covered by DBSI's research
is available to customers of DBSI in the United States at no cost. Customers can access IR at
http://gm.db.com/IndependentResearch or by calling 1-877-208-6300. DISCLOSURES AND ANALYST CERTIFICATIONS ARE
LOCATED IN APPENDIX 1.
Industry Update
Companies featured
ICBC (1398.HK),HKD3.29 Buy
2007A 2008E 2009E
P/E (x) 19.9 8.0 8.8
Div yield (%) 0.3 6.3 5.7
Price/book (x) 3.4 1.5 1.4
China Construction Bank (0939.HK),HKD3.79 Hold
2007A 2008E 2009E
P/E (x) 18.6 7.5 9.0
Div yield (%) 4.0 5.3 4.4
Price/book (x) 3.6 1.5 1.4
Bank of China (3988.HK),HKD1.87 Hold
2007A 2008E 2009E
P/E (x) 17.7 6.2 6.6
Div yield (%) 1.0 6.1 5.3
Price/book (x) 2.2 0.9 0.8
Bank of Communications (3328.HK),HKD4.91 Sell
2007A 2008E 2009E
P/E (x) 21.0 7.5 11.5
Div yield (%) 1.1 5.4 3.5
Price/book (x) 3.9 1.5 1.4
China Merchants Bank-H (3968.HK),HKD12.00 Hold
2007A 2008E 2009E
P/E (x) 23.7 7.6 8.9
Div yield (%) 1.1 3.9 3.4
Price/book (x) 6.7 1.9 1.6
China CITIC Bank (0998.HK),HKD2.75 Buy
2007A 2008E 2009E
P/E (x) 24.1 6.8 7.1
Div yield (%) 0.3 4.4 4.9
Shanghai Pudong Bank (600000.SS),CNY16.20 Hold
2007A 2008E 2009E
P/E (x) 30.6 6.5 10.8
Div yield (%) 0.4 1.0 1.6
Price/book (x) 8.1 2.3 1.7
China Minsheng Bank (600016.SS),CNY4.42 Sell
2007A 2008E 2009E
P/E (x) 19.3 8.1 22.2
Div yield (%) 0.0 1.1 0.8
Price/book (x) 3.3 1.6 1.4
SZ Development Bank (000001.SZ),CNY11.36 Hold
2007A 2008E 2009E
P/E (x) 18.0 52.4 10.0
Div yield (%) 0.0 0.0 0.0
Price/book (x) 5.2 2.2 1.8
Global Markets Research Company
Still good news - loan growth to surprise on the upside
Our recent meetings with management of the major Chinese banks and regulators
have led us to believe that there has been strong credit demand in late 2008 and
YTD 2009. As the loan approval process can take some time, there has been a
strong surge in discounted bills in Nov and Dec 2008. In our view, 1Q09 loan
growth could surprise on the upside as these discounted bills mature and turn into
new loans, of which we expect a significant amount will be granted after Chinese
New Year. Additionally, recent CBRC initiatives to remove the 75% cap on smallto
medium-sized banks’ loan-to-deposit ratios (LDR), relax the scope of lending to
M&A related loans, allow bridge financing (previously disallowed) and restructure
loans should also boost loan growth for 2009.
Chinese banks in a regional context – only country to offer growth
While Chinese banks’ earnings growth would suffer from NIM contraction and
rising credit costs similar to most banks in the region, the ROE of the Chinese
banking sector is still among the highest across the region; in addition, Chinese
banks’ balance sheets remain strong, with one of the highest provision coverage
ratios regionally despite very conservative NPL assumptions.
Overhang over for BOC; ICBC has lock-up expiries in Apr and Oct this year
Currently, we believe most of the speculation on strategic holders exiting
following the lock-up expiry is over for BOC. However, ICBC could be the next
target as half of the lock-up of the strategic stakes of Goldman Sachs, Allianz and
American Express would expire in Apr with the remaining half in Oct this year.
Meanwhile, BoA still has 13.5bn CCB shares (or 35% of its current holdings) that
are tradable after the recent sell-down. For the joint-stock banks, HSBC has
reiterated its intention not to sell its BCOM stakes (according to the latter’s
website). CMB does not have any major foreign strategic holders unlocking.
Finally, BBVA’s lock-up in Citic should expire in Jan 2009 and Mar 2010.
Ratings change: Citic Bank now top pick with ICBC, bank PTs revised
We have revised our earnings and PT for Citic Bank, upgraded it to a Buy and
added it to our top picks as we believe its operating trends are better than its
peers in the current downcycle. ICBC is another top pick; we see further pressure
on its stock price in the near term (due to speculation on strategic holders’ sell-off)
-- an opportunity for investors -- and will be especially attractive if valuation falls
below 1.4x 2009E P/B. Finally, we have also revised our earnings and PT for SPDB,
Minsheng and SZDB (upgrade to Hold) to reflect our latest outlook and 2008
results preannouncement. Please see respective company sections for valuation
and risks.
Table of Contents
Executive summary ........................................................................... 3
Sector investment strategy – earnings deceleration the main theme; looking for growth and
resilient players .........................................................................................................................3
Macro and credit growth outlook .................................................... 5
Macro economy - worst deceleration in a decade, GDP growth to be double dip scenario.....5
Credit growth accelerating, demand not only from Rmb4tr government spending..................5
A tug of war – growth versus credit quality and credit risk .......... 7
Operating trends – solid growth unnecessary to fully offset the margin compression.............7
Asset quality – rising credit risks become the main issue of 2010E .........................................8
Chinese banks in a regional context .............................................. 10
Chinese banks - possibly the only area that still offers growth ...............................................10
Mortgage – will the halved interest rate help affordability? ....... 13
Smaller banks more aggressive in re-pricing existing mortgages ...........................................13
Risks – Overhang of unlocking the strategic investors ................ 15
Chinese banks – lock-up expiries peak in late 2008/early 2009...............................................15
ICBC .................................................................................................. 21
China Construction Bank ................................................................ 24
Bank of China................................................................................... 27
Bank of Communications................................................................ 30
China Merchants Bank-H ................................................................ 33
China CITIC Bank ............................................................................. 36
Shanghai Pudong Bank................................................................... 41
China Minsheng Bank ..................................................................... 46
SZ Development Bank..................................................................... 51
290825.pdf
(1.91 MB, 需要: 500 个论坛币)
京公网安备 11010802022788号
