净息差韧性凸显。报告期内公司净息差为2.82%，同比-21bp，较上季度-1bp。生息资产平均收益率、计息负债平均成本率分别为4.74%、2.24%，较上季度+6bp、+5bp，生息资产收益率上行速度略高于计息负债上行速度，息差环比小幅收窄预计主因生息资产扩张速度下降。Incident: Changshu Bank released its 2024 three-quarter report. During the reporting period, the company achieved operating income of 8.37 billion yuan, +11.30% YoY; net profit to mother of 2.976 billion yuan, +18.17% YoY; and ROE (weighted) of 14.96%, +0.77% YoY.
Performance growth remained steady, mainly driven by return on investment. Total revenue for the first three quarters of 2024 was 8.37 billion yuan, +11.30% year-on-year. Net interest income was 6.903 billion yuan, +6.15% year over year, accounting for -4.00pct year on year, and the net interest income growth rate narrowed marginally. Non-interest income was 1.467 billion yuan, or +44.25% year over year, accounting for +4.00pct year over year; of these, net investment income was +92.54%, accounting for +6.75% year over year, which was the main driving force for non-interest income growth. The cost-revenue ratio was 35.17%, year-on-year -4.13pct, and the cost was effectively reduced.
The size of retail loans has shrunk month-on-month, and deposit regularization has slowed. As of the end of the reporting period, the company's total loan amount was 239.686 billion yuan, +7.75% from the end of the previous year and +0.31% at the end of the previous quarter. The loan growth rate slowed down. Looking at the structure, the size of retail loans was tightened by +0.57%, -1.19%, and +13.19% compared to the end of the previous quarter, respectively, and was a major drag on loan expansion. As of the end of the reporting period, the company's total deposit amount was 284.609 billion yuan, +14.79% compared to the end of the previous quarter; of these, current and term deposits accounted for 18.66% and 71.67%, and +0.13pct and -0.21pct at the end of the previous quarter. Overall deposit regularization has slowed down.
The resilience of net interest spreads is prominent. The company's net interest spread during the reporting period was 2.82%, -21bp year-on-year, and -1bp compared to the previous quarter. The average return on interest-bearing assets and the average cost ratio of interest-bearing liabilities were 4.74% and 2.24%, respectively. Compared with +6bp and +5bp in the previous quarter, the rate of increase in yield on interest-bearing assets was slightly higher than the upward rate of interest-bearing debt. The slight narrowing of interest spreads is expected mainly due to the decline in the expansion rate of interest-bearing assets.
Asset quality fluctuated slightly, and risk offsets remained high. As of the end of the reporting period, the company's defect rate and attention rate were 0.77% and 1.52%. Compared with +1bp and +16bp at the end of the previous quarter, the asset quality situation fluctuated slightly, and retail asset risk exposure is expected to increase. The provision coverage rate and loan provision rate were 528.40% and 4.09%, compared with -10.41pct and -0.02pct at the end of the previous quarter; provision coverage remains at a high level and has strong risk resilience.
Investment advice: The company adheres to the development strategy of serving the “three rural” and small and micro enterprise markets, maintains a steady improvement in business performance, and maintains a low asset failure rate. The company's revenue for 2024-2026 is estimated to be 10.9, 11.962, 13.339 billion yuan, net profit due to mother of 3.859, 4.45, 5.147 billion yuan, and BVPS of 9.48, 11.24, and 12.65 yuan. The PB valuation corresponding to the closing price on October 25 is 0.75, 0.63, and 0.56 times. Maintain a “buy” rating.
Risk warning: macroeconomic fluctuations, deteriorating asset quality, retail business expansion falling short of expectations
