德意志银行---2007中国城市商业银行

Table of Contents
Next stage of bank reforms .............................................................. 3
Long-term sector implications .................................................................................................. 3
Near-term investment recommendation ................................................................................... 3
Emerging competitors to the party ................................................. 5
The fastest growing banking group in China............................................................................. 5
Simple reform agenda............................................................................................................... 6
Key competitive advantage .............................................................. 7
Already come a long way.......................................................................................................... 7
Direct access to China’s booming local economy .................................................................... 7
Ability to maintain high growth in a tightening environment..................................................... 8
Net interest margin protected by unique asset-liability mix ...................................................... 9
More cost-efficient operating model....................................................................................... 11
Greater employee incentives and alignment........................................................................... 12
A cherry-picking game .................................................................... 13
The evolution of polarization ................................................................................................... 13
Size doesn’t matter ................................................................................................................. 14
Consolidation opportunity ....................................................................................................... 15
Potential long-term winners .................................................................................................... 17
Company pages ............................................................................... 18
Bank of Ningbo (NBCB, 002142.SZ, NR)................................................................................. 19
Bank of Nanjing (NJCB, 601009.SS, NR)................................................................................. 23
Bank of Beijing (BOB, 601169.SS, NR).................................................................................... 27
Bank of Shanghai (BOS, not listed) ......................................................................................... 31
Bank of Tianjin (TJCB, not listed)............................................................................................. 35
Bank of Dalian (DLCB, not listed) ............................................................................................37
Hangzhou City Commercial Bank (HZCB, not listed) ............................................................... 39
Bank of Chongqing (CQCB, not listed) .................................................................................... 41
Appendix A – The history of city commercial banks .................... 43
Establishment ......................................................................................................................... 43
Asset cleaning initiatives......................................................................................................... 43
Introduction of strategic investors ..........................................................................................44
Cross-region expansion........................................................................................................... 45
IPO buzz to come through ......................................................................................................45
Appendix B – Major economic regions in China ........................... 46
Appendix C: M&A in India .............................................................. 49
Venturing down the M&A path – A proxy for China ................................................................ 49
ICICI Bank - Sangli Bank .......................................................................................................... 50
Centurion Bank of Punjab - Lord Krishna Bank........................................................................ 51