In 2022, the company's net profit was 4.92 billion yuan, down 11% year-on-year. Value contributions were further concentrated on finance companies and commercial banks. CNPC Finance and Kunlun Bank contributed 36% and 43% of net profit to the parent, respectively. The total contribution reached 79%, up 12 pcts from 2021, and the overall business situation was stable. The trust business experienced losses, dragging down performance. Kunlun Trust's net profit in 2022 was -400 million yuan, a decrease of 750 million yuan over the previous year. We expect that the 2023 performance may still be under pressure, and the impact on the company's overall performance remains to be tracked and observed. Some shareholders who participated in the fixed increase in 2016 are still planning to reduce their holdings.
In 2022, the company's net profit was 4.92 billion yuan, down 11% year-on-year, lower than our expectations. The company's total revenue in 2022 was 32.43 billion yuan, an increase of 5% over the previous year; due to factors such as the downturn in the capital market and the downturn in LPR, the company's net profit was 4.92 billion yuan, down 11% from the previous year. Earnings fell short of our expectations, mainly due to higher management costs than we expected, and losses due to changes in fair value.
Value contributions are further concentrated on finance companies and commercial banks. According to the company announcement, the total revenue of the company in 2022 was contributed by segment. The commercial bank/finance company/financial leasing/trust business contributed 45%/39%/9%/2% respectively. The combined share of commercial banks and finance companies increased further to 83% from 79% in 2021. Looking at subsidiary entities, CNPC Finance and Kunlun Bank's combined revenue accounted for 86% of total revenue, up 4pcts from 82% in 2021. Looking at net profit contribution, CNPC Finance/Kunlun Bank/Kunlun Financial Leasing/Exclusive Insurance/Kunlun Trust division contributed 58%/26%/10%/4%/-4% of net profit; looking at net profit attributable to the mother, CNPC Finance/Kunlun Bank/Kunlun Financial Leasing/Exclusive Insurance/Kunlun Trust contributed 36%/43%/14%/4%/-7% of net profit to the mother; CNPC Finance and Kunlun Bank contributed 79% to Guimu's net profit, an increase of 12pcts from 2021. It is expected that this trend will continue in 2023..
Finance company: Serves within the group and maintains stable profits. The total financial revenue of CNPC in 2022 was 13.30 billion yuan, an increase of 5% over the previous year; net profit was 6.31 billion yuan, and net profit of the mother was 1.77 billion yuan, which was basically the same. At the end of 2022, CNPC's financial loans to CNPC were 12.6 billion yuan, an increase of 3.7 billion yuan over 2021, and CNPC capital's other affiliates loaned CNPC financial loans of 98.2 billion yuan, a decrease of 12.6 billion yuan from 2021; CNPC's financial deposits at CNPC were 235.7 billion yuan, a decrease of 29 billion yuan from 2021; other affiliates of CNPC Capital made financial deposits of 125.8 billion yuan of CNPC capital, an increase of 24.2 billion yuan over 2021, and it is expected that overall stability will remain stable in 2023.
Banking business: Incremental revenue and profit are the biggest contributors, and profit margins remain stable. Kunlun Bank's total foreign revenue in 2022 was 14.44 billion yuan, an increase of 13% over the previous year; net profit was 2.77 billion yuan, and Guimu's net profit was 2.13 billion yuan, an increase of 9% over the previous year. It was the most important contributor to Guimu's net profit. Looking at incremental revenue, total operating revenue in 2022 increased 1.47 billion yuan compared to 2021, and Bank of Kunlun contributed 1.70 billion yuan, which is significantly higher than CNPC Finance's 660 million yuan. Looking at incremental net profit, net profit in 2022 fell 750 million yuan compared to 2021, of which Kunlun Bank increased 230 million yuan, to a certain extent offsetting the drag on Kunlun Trust's performance.
Bank of Kunlun's net interest rate in 2022 was 19.1%, a slight decrease from 19.9% in 2021, but it remained stable, and the impact of narrowing interest spreads on performance was relatively limited.
The decline in financial leasing performance and losses in the trust business were the main factors that dragged down performance. Kunlun Financial Leasing achieved total foreign revenue of 2,884 billion yuan in 2022, down 11% from the previous year; exchange losses of 230 million yuan (vs. 0.6 billion yuan in 2021); and achieved net profit of 1,126 million yuan, down 17% from the previous year. It invested 16.542 billion yuan throughout the year, with total assets of 60.9 billion yuan at the end of the year. Kunlun Trust achieved a total foreign operating income of 530 million yuan in 2022, a decrease of 29% over the previous year; net profit of -400 million yuan, a decrease of 750 million yuan over the previous year; Guimu's net loss was 350 million yuan, a decrease of 650 million yuan over the previous year, which was the main reason that dragged down performance. Mainly due to the overall pressure on the trust industry, Kunlun's trust business is in a transition period. The scale of traditional trust assets continues to drop, while the new business is still in its infancy. Combined with the decline in the capital market, investment-related income has declined. In 2022, Kunlun Trust's net interest income was -0.4 billion yuan, a decrease of 0.5 billion yuan; net income from fees and commissions was 5.1 billion yuan, a decrease of 210 million yuan over the previous year; investment income was 330 million yuan, a decrease of 210 million yuan over the previous year; loss from changes in fair value was 380 million yuan (compared to income of 150 million yuan in 2021). We expect Kunlun Trust's performance in 2023 may still be under pressure, and the impact on the company's overall performance is yet to be monitored.
Shareholders have decided to reduce their holdings, and some shareholders are still in the planning period to reduce their holdings. According to the 2022 annual report, 5 shareholders of the top 10 shareholders reduced their holdings. The five shareholders of Aerospace Information, Taikang Asset (pension products), China Construction Capital, State-owned Capital Venture Capital, and Great Wall Asset Management Company reduced their holdings by 250 million shares in total, accounting for about 2% of the total share capital. In December 2022, the company announced shareholder Strait Energy's holdings reduction plan. In April 2023, according to its announcement on the progress of the shareholder halfway through the shareholding reduction plan, the shareholder reduced its holdings by 80 million shares from March 6 to April 4, 2023, accounting for 0.65% of the company's total share capital. The shareholder still holds 1.16% of the company's shares, which does not rule out further holdings reduction during the remaining holdings reduction period. Among the shareholders who reduced their holdings mentioned above, Strait Energy, Aerospace Information, Taikang Assets, China Construction Capital, and State-owned Venture Capital were all shareholders participating in the fixed increase in 2016. Strait Energy, the majority shareholder of CNPC, acted in concert.
risk factors. Major shareholders have continued to drastically reduce their holdings; the prosperity of major investment industries has declined, and the quality of credit assets has declined sharply. The trust industry is facing transformation, and the quality of the underlying assets of products fluctuates; large fluctuations in market conditions bring about fluctuations in earnings from investment financial products; and there is a risk that the internal control and policies of financial control platforms exceed expectations.
Profit forecasts. According to financial information, we adjusted the total revenue of 2023/24 to 34.1 billion/35.3 billion yuan (previous value of 33.4 billion/35 billion yuan), introduced the 2025 forecast of 36.7 billion yuan, adjusted the 2023/24 net profit to 5.7 billion/5.9 billion yuan (previous value of 6.2 billion/6.4 billion yuan), and the 2025 forecast of 6.3 billion yuan, an increase of 16%/4%/6% over the previous year; the corresponding net assets were 99.7 billion/103.8 billion yuan/108.1 billion yuan, corresponding PB was 0.96/0.92/ 0.88x