【出版时间及名称】：2010年中国银行业前景展望
        【作者】：瑞士信贷
        【文件格式】：pdf
        【页数】：42
        【目录或简介】：
Earnings always prevail in driving share prices. In recent months,
sentiment on China banks has turned cautious, as the fear of market
tightening has grown. While history suggests that tightening always causes a
sell-off, earnings eventually drive share price performance. We expect the
sector’s 20%-plus earnings growth this year to remain highly likely, with the
government’s slow exit from the massive stimulus last year.
■ Asset quality is an issue, but premature. While we are under no illusion
that the massive lending last year could lead to some sort of asset quality
problem at some point, we continue to believe this is a premature issue to
upset earnings. The market may sell off banks when this issue is brought to
centre stage, but we think a rebound in share prices after a sell-off is likely to
be as speedy, if our assessment on the asset quality situation proves right
The fast build-up of the coverage ratio and systematically extended loan
duration makes an NPL shock to the system unlikely in 2010-11, in our view.
■ Larger banks; fewer risks. We maintain our preference for large banks,
and CCB is our top pick on a 12-month horizon. We believe it will play catchup
on a margin recovery this year, which should reverse its
underperformance last year. We also initiate coverage of two mid-cap banks,
China CITIC Bank (CNCB) and China Minsheng Banking Corp (CMBC), with
OUTPERFORM and NEUTRAL ratings, respectively. Capital is a common
issue among the mid-cap banks, which we believe are fairly valued overall
when adjusted for higher capital needs. CNCB is a relative value in this
space, while we see high cost pressure at CMBC as an additional issue for
this newly listed bank.