① In 2023, we will continue to maintain a cash dividend ratio of 30% of net profit to mother. In addition, we also fully consider investors' demands, and plan to launch an interim dividend in 2024. ② We will continue to strengthen communication between institutional investors and major shareholders and actively promote the majority shareholders to increase their holdings.
Financial Services Association, April 26 (Reporter Gao Ping) After disclosing its 2023 annual report and this year's quarterly report the night before, the Bank of Jiangsu was “voted” by investors today. The trading market shows that today, the Bank of Jiangsu jumped sharply and at one point was close to falling to a standstill. By the midday close, Bank of Jiangsu was down 9.6%. After opening in the afternoon, the Bank of Jiangsu's decline narrowed. As of press release, it was down 8.77%.
According to the data, the revenue and net profit of the Bank of Jiangsu increased by 5.3% and 13.3% year-on-year in 2023, while the fourth quarter of 2023 experienced year-on-year declines, respectively. However, the first quarter of 2024 increased 11.72% and 10.02% year-on-year, respectively. According to some brokerage research reports, the net profit growth rate of the Bank of Jiangsu is lower than market expectations. Today, at the 2023 and 2024 first quarter results exchange meetings, Bank of Jiangsu management responded to issues such as this year's performance trends, dividend plans, and market value management measures.
Management looks forward to this year's performance trends
“Overall, the net profit growth rate of the Bank of Jiangsu declined significantly compared to previous expectations, lower than our expectations and market expectations, mainly due to pressure on interest spreads and provisions.” As for the latest periodic report disclosed by the Bank of Jiangsu, the CICC Research Report believes this. According to the data, the revenue and net profit of the Bank of Jiangsu increased by 5.3% and 13.3% year-on-year in 2023, while the fourth quarter of 2023 decreased by 7.1% and 36.8%, respectively, and increased 11.72% and 10.02%, respectively, in the first quarter of 2024.
In recent years, interest spreads in the banking sector have generally been under pressure to narrow. According to the annual report, the net interest spread of the Bank of Jiangsu fell back to 1.98% in 2023, and the net spread was 1.95%. In 2022, the net spread was 2.32%, and the net spread was 2.11%. According to the CICC research report, the average daily net interest spread of the Bank of Jiangsu reduced by 34 bps to 1.98% year-on-year for the full year of 2023. The research report believes that income from holding transactional financial assets under the restoration caliber is no longer included in interest income. It is estimated that net interest spreads for the fourth quarter of 2023 fell 35 bps to 1.59% from quarter to quarter, and rose 23 bps to 1.82% in the first quarter of 2024.
At the results meeting, some investors mentioned issues such as the reason for the low profit in the fourth quarter of 2023. Bank of Jiangsu management did not respond positively to this issue, but only stated that the bank's revenue and net profit maintained healthy growth throughout 2023. Against the backdrop of a high base in the first quarter of last year, the revenue and net profit growth rate for the first quarter of this year remained in double digits, reflecting a healthy sustainable development trend, and will continue to aim to outperform the market in the future.
Also, looking ahead to this year's performance trends, Bank of Jiangsu Chairman Ge Renyu emphasized that the first quarter of this year had a good start. “Combined with regular reports and previous exchanges, I believe everyone can see that the Bank of Jiangsu continued to maintain a steady and good development trend last year and the first quarter of this year. In particular, in the first quarter of this year, we further achieved both revenue growth and net profit from a high base and a high starting point, and achieved a relatively good start.” Ge Renyu said that although the development environment and industry competition faced by banks are becoming increasingly complex and severe, they are still confident that they will successfully achieve their goals for the whole year.
To carry out mid-term dividends, research has been carried out on efforts such as increasing the frequency of dividends
The dividend situation of listed banks is a topic of concern in the market. According to reports, in addition to the 2023 cash dividends, the Bank of Jiangsu distributed a total of more than 38 billion yuan in common stock cash dividends in the eight years since its listing. If dividends on preferred shares and convertible bonds are added, the total dividends paid to various investors in the A-share market exceed 45 billion yuan. “In particular, in the last four years, we have further combined changes in the internal and external situation, and maintained a cash dividend ratio of 30% of net profit to mother every year on the basis of overall consideration of investor returns and our own sustainable development. Our stock price performance outperformed the market during the same period, providing investors with more stable cash dividends and stock investment returns.” Lu Songsheng, secretary of the board of directors of the Bank of Jiangsu, said.
Recently, cash dividend guidelines for listed companies and the “Nine Rules of the New Country” have been released one after another. What are the plans of the Bank of Jiangsu for future dividends? Lu Songsheng said that over the past period, the bank has closely followed, carefully studied and studied some of the new regulations and requirements introduced by the supervisory authorities. Although listed banks are relatively special in terms of industry attributes and continue to step up efforts to promote services and welfare measures for the real economy, and the immediate need for capital is getting stronger and stronger, the Bank of Jiangsu still hopes to maintain stability in the overall dividend policy.
Recently, the board of directors of the Bank of Jiangsu deliberated and passed a bill requesting the shareholders' meeting to authorize the board of directors to decide on mid-term profit distribution in 2024. Lu Songsheng said that the Bank of Jiangsu has carried out careful research on some tasks such as increasing the frequency of dividends. Specifically, the board of directors will implement it in strict accordance with relevant regulations on the basis of considering the company's profit situation, cash flow situation, and medium- to long-term development plans in an integrated manner.
The results will be met with a sharp drop in the company's stock price. In further question-and-answer exchanges, some investors asked about the Bank of Jiangsu's specific measures in market value management in 2024. In response, the Bank of Jiangsu management said that it will actively carry out market value management and promote market value management in several areas in 2024. The first is to continue to do a good job in business management and continuously increase investor returns. “Looking at the first quarter, the Bank's revenue and net profit to the mother maintained a healthy trend of steady progress and outperforming the general trend.” Second, efforts are being made to maintain a high cash dividend ratio. In 2023, it continues to maintain a cash dividend ratio of 30% of net profit to mother. In addition, it also fully takes into account investors' demands, and plans to launch an interim dividend in 2024; third, it will continue to strengthen communication between institutional investors and major shareholders to actively promote the increase in shareholders' holdings. The amount of majority shareholders' holdings increased in 2023 is the highest in Shanghai, and further work in this area will be improved in 2024.