Investment advice: Maintain ICBC's 2024-2026 net profit growth forecast of 0.43%/0.66%/1.57%, corresponding to EPS of 0.98/0.99/1.01 yuan. Maintain the target price of 7 yuan, corresponding to 0.68 times PB in 2024, and maintain an increase in holdings rating.

Revenue performance was generally stable, and the net profit growth rate declined to a certain extent. 2024Q1 revenue declined 3.4% year over year, the contribution of other non-interest income to revenue declined, and the decline in net income from interest and processing fees and commissions narrowed. According to estimates, the year-on-year decline in Q1 net interest spreads narrowed, rising 2 bps month-on-month, mainly due to the recovery in yield on interest-bearing assets, and the cost ratio of interest-bearing debt remained basically flat. Net profit fell 2.8% year on year. As the pressure of repricing declines and the effects of deposit cost control gradually become apparent, the pressure on performance growth may ease in the future. The first quarter may be the bottom of the 2024 profit growth rate.

Credit growth has been maintained at a high rate, and the deposit structure has improved. Loans increased 11.6% year over year. The increase in loans was mainly to the public, and the size of notes declined slightly. In terms of deposits, Q1 demand deposits increased 4.9% from the beginning of the year, faster than time deposits, which led to an increase of 2 bps in demand deposits in debt, and the debt structure was optimized to a certain extent. Q1 Total assets are growing faster than loans, debt is growing faster than deposits, and the allocation of interbank assets and interbank liabilities has increased.

Asset quality is stable. Compared with the end of 2023, the non-performing rate remained flat at the end of Q1. The provision coverage rate increased by 2.3 pc to 216.3%, and the loan ratio increased by 3 bps to 2.93%.

Risk Warning: Demand recovery fell short of expectations; retail loan risk exposure exceeded expectations.