Everbright Bank in 2021 performance growth rate decline related to housing ratio lower than peers

2022-08-23 0 By

On March 28th, Everbright Bank (601818.SH) held a results conference to answer the hot questions related to the company’s revenue, wealth management and housing business.Previously, Everbright Bank disclosed the 2021 annual report, the reporting period to achieve operating revenue of 152.751 billion yuan, a year-on-year growth of 7.14%;Net profit reached 43.639 billion yuan, up 15.06% year on year.From the perspective of performance, Everbright Bank’s performance growth has fallen, with revenue and net profit rising 7.14% and 14.73% year-on-year respectively, down 2.12% and 3.75% compared with the third quarter of 2021.Guangfa Securities research report analysis pointed out that from the performance split, scale growth, other income and expenditure, provision provision is the main positive contribution factors, net interest margin is the main negative contribution factors.According to the annual report, the bank’s net interest margin was 2.07%, down 0.13% year on year;Net interest yield 2.16%, down 0.13% year on year.Everbright Bank said the average yield on loans and advances fell 0.26 percent year on year, mainly due to the implementation of the national policy of cutting fees and transferring profits to ease the “difficult and expensive financing problem” and improve the quality and efficiency of services to the real economy.”From the national policy level and the economic perspective in the past two years, the interest margin of the entire banking sector may decline year by year, which may be a common problem faced by the banking industry,” everbright bank executives said at the earnings release.Looking at 2022, the executive said that other downward pressures remain large in the overall judgment, but added that there are also some favorable factors to be seen.The executive pointed out that from the asset side, on the one hand, to increase support for key economic areas, through the real economy services, through 2022 credit effectively to stabilize the base;On the other hand, since last year, including in this year’s allocation of credit resources, Everbright Bank has firmly increased the proportion of retail credit in the middle of the entire credit structure, through the optimization of the income structure to stabilize the income level of the asset end.On the debt side, as commercial banks compete fiercely in the market, the decline in the debt cost is rigid to some extent on the one hand, but on the other hand, the monetary policy departments of the Central Bank are also actively guiding the downward interest rate on the debt of commercial banks.The executive also said that the bank itself must improve internal skills, in the deposit must achieve a new path, improve contact with small and medium-sized enterprises to obtain more settlement funds;Promote the transformation of wealth management and increase median income;We will do a good job in key areas of national development, such as rural revitalization.Hair force wealth management and net interest income ratio narrowing relative, is everbright Bank non-interest income ratio growth.The annual report shows that everbright Bank fee and commission net income of 27.314 billion yuan, year-on-year growth of 11.90%, accounting for 17.88%, compared to 2020 has expanded.The growth in net fee and commission income was mainly from fee income from wealth management services, which increased by 1.458 billion yuan year-on-year, or 57.90 percent, according to Everbright Bank.Unlike some diversified banks, Everbright’s strategic vision is simply to “build a first-class wealth management bank”.From the perspective of wealth management, everbright Bank serves the needs of enterprises and individuals for wealth management. Intermediary business income is one of the important profit growth points created by everbright Bank. Net fee and commission income grew faster than the overall revenue growth rate of 4.76 percentage points, and the total growth rate is fast.”In 2021, we will focus on the development strategy of wealth bank, and retail financial business will gradually become an important system for everbright Bank’s transformation and development, which is the internal support for continuous improvement of business performance.”Everbright Bank president Fu Wanjun pointed out at the results conference.The annual report also reflects the contribution of wealth management to the growth of retail business. In 2021, the bank deepened the transformation of wealth management and realized the net income of personal wealth management fee of 7.944 billion yuan, up 23.09% year on year. Among them, the income of agency fund increased 37.92% year on year, and the income of agency trust increased 49.41% year on year.It is worth mentioning that everbright Bank financial management subsidiary’s total assets under management has broken through one trillion yuan, reached 1,067709 billion yuan, net profit of 1.586 billion yuan last year.Fu Wanjun revealed that in the future, the bank will continue to guide the whole bank by deepening the structure integration of science and technology retail, including the construction of business capabilities in Taiwan, and by optimizing the allocation of financial resources and performance resources.At the same time, we should give full play to the comprehensive operation platform of Everbright Group and constantly improve our own capabilities. In this process, we should especially speed up the development of intermediary business of retail business, which is the main direction of the bank in the past two years.In its results release, Everbright bank also detailed its housing-related business.Yang Bingbing, vice president of the bank, said: “Our share of property-related assets in 2021 is below the average of comparable peers.”Yang bingbing said there is still room for the bank’s indicators to fall short of the regulatory ceiling of 27.5% of total real estate loans and 20% of personal housing loans.The annual report shows that real estate loans accounted for 11.03% of corporate loans;Personal housing loans totaled 565.296 billion yuan, accounting for 17.09% of the bank’s outstanding loans.Yang mentioned four ways everbright Bank deals with housing-related business.First, because of the strict implementation of the real estate loan concentration requirements, so everbright Bank real estate loan scale and proportion is relatively lower than the average level of joint-stock banks.Second, Everbright Bank strictly implement the unified credit system and table, the credit, investment, financial management, sales and other businesses are included in the same audit scope, prudently check the customer limit, strictly control the single group and single customer credit concentration, so the scale of credit for the main real estate enterprises is relatively controllable.Third, through forward-looking investigation and intelligent early warning, effective pressure to reduce the scale of high-leverage housing enterprises.Fourth, most of everbright Bank’s real estate loans have adequate collateral, pledge guarantee, risk control measures are relatively strong.”So from the perspective of the four aspects and the overall situation, our risk is controllable and will not cause a major impact on the asset quality of our bank.”In the next step, Yang Bingbing said that in 2022, the country will still focus on stabilizing land prices, housing prices and expectations to promote the steady and healthy development of the real estate market. “Therefore, we believe that the current situation of the real estate market is only a short-term fluctuation under the long-term trend, and we expect the real estate industry to gradually stabilize in the future.”Under such circumstances, Yang bingbing said, Everbright Bank should first actively support the construction and operation of affordable rental housing;Second, to actively support urban renewal projects;The third is to reasonably support high-quality real estate m&a projects;Fourth, we will support the commercial housing market to better meet the reasonable housing needs of home buyers, and adopt urban policies to promote the healthy development and virtuous cycle of the real estate market.