DB 德银：中国工商银行 H股

ICBC (Asia) Good results, capital is growth headwind; prefer BEA

20 March 2007 １４页　英文

Numbers ahead of the street on margins
ICBC Asia (ICBCA) reported 2006 net profits of HK$1,246m (+27% yoy) ahead of
consensus by 9%. Variance is due to stronger interest earnings asset growth
(+27% yoy) and margin (+26bps yoy). We believe the surprise in margins is a
reflection of higher free fund returns, thanks to ICBCA acting as a receiving bank
for 15 IPOs. Final dividend declared was HK$0.46 per share, bringing full year to
HK$0.66 or payout of 60%.
Trajectory of growth should slow unless capital comes in
We expect PPOP growth of 11% in 2007 with loan volumes at 6% (versus +9% in
2006). We have revised earnings up by 13% and 10% in 2007 and 2008 on higher
interest earning asset base. We expect slower loan growth due to tight capital
with CAR of 16% and Tier-1 at 8.5% (peers’ Tier-1 is 11%). We would see any
issuance of equity/hybrid equity as a positive signal for growth to reaccelerate.