Core ideas:
Ping an Bank released its report for the third quarter of 2023, and our comments are as follows: 23Q1~3 revenue, PPOP and home net profit increased by-7.7%,-7.8% and 8.1% respectively compared with the same period last year, and the growth rate was lower than that of 23H1 by 3.98pct, 4.87pct and 6.82pct. From the cumulative performance-driven point of view, scale growth, net fee income, provision provision, effective tax rate reduction is the main positive contribution, narrowing net interest margin, other income and expenditure and other factors are a drag.
Highlights: (1) Private wealth showed outstanding performance. at the end of 23Q3, the company's retail AUM and private AUM increased by 11.5% and 17.2% respectively compared with 22A, and the wealth management fee income in the first three quarters was 5.636 billion yuan, an increase of 10.4% over the same period last year. The new bancassurance business developed rapidly, with personal insurance income of 2.855 billion yuan in the first three quarters, an increase of 98.3% over the same period last year. (2) the bad rate of retail loans fell further. The non-performing loan ratio at the end of 23Q3 was 1.04%, slightly higher than that of 23H1. Among them, the bad rate of public loans went up 7bp, and the bad rate of retail loans went down 2bp, mainly due to the obvious decline in the bad rate of car loans and credit cards. The final attention rate and overdue rate of 23Q3 are higher than that of 23H1 by 3bp and 4bp respectively. It is estimated that the new generation rate of 23Q1~3 is 1.81%, which is down 8bp from the same period last year, and the new bad control continues to be optimized. The coverage rate of 23Q3 end-of-provision is 282.62%, which is lower than that of 23H1. Overall, the asset quality indicators of the company are basically sound.
Concern: (1) negative growth of 23Q3 loans. Total loans fell by 13 billion yuan in the third quarter, mainly due to the company's reduced risk appetite, adjustment of retail loan structure, and a sharp drop in the size of high-risk new loans and credit card loans. The overall performance of the public end is stable, and the increment of Q3 is higher than that of Q2. (2) the interest rate spread continues to narrow, the asset end is dragged down more, and the debt cost is rigid. The company's 23Q1~3 net interest margin is 2.47%, narrowing 8bp compared with 23H1, and the main pressure is on the asset side. The rate of return on interest-bearing assets of 23Q1~3 is narrower than that of 23H1, and the rate of return on loans is narrower than that of 23H1. First, due to the negative growth of high-yield retail loans such as 23Q3 new loans and credit cards, the rate of return on retail loans is 52bp lower than that of 23H1. The yield on public loans is basically stable. Second, due to the current weak credit, the proportion of loans to interest-bearing assets at the end of 23Q3 has declined, while the proportion of central bank deposits and interbank assets has increased, resulting in a decline in the overall return on assets. On the debt side, the cost rate of 23Q1~3 deposits is 2.20%, which is the same as that of 23H1. Due to the high cost of foreign currency deposits and fixed deposits and other factors, the cost of the debt side is rigid. We still need to pay attention to the overseas interest level and the recovery of the domestic economy.
Profit forecast and investment advice: it is estimated that the company's 24-year net profit growth rate will be 14.1%, 15.5%, 2.53, 2.94 yuan per share, respectively. The current stock price corresponds to the 24-year PE of 23max, which is 4.17X/3.58X, and the 24-year PB, 0.50X/0.44X, respectively. Taking into account the company's historical PB (LF) valuation hub and fundamentals, give 23-year PB a valuation of 1.0X, a reasonable value of 21.18 yuan per share, and maintain a "buy" rating.
Risk hints: (1) economic growth is falling faster than expected; (2) deposit costs are rising higher than expected; (3) international economic and financial risks are higher than expected; (4) policy regulation is stronger than expected.