时间：2010.9.13
作者：jp摩根
格式：pdf
页数：17

主要内容：
Industry news: 1) August new lending at Rmb545.2bn exceeded market
expectation, implying solid credit demand during economy recovery. 2)  
PBOC President Mr. Zhou Xiaochuan said appropriately managed
banking spread is critical for China banks to maintain healthy operations
in current environment. 3) CBRC is considering asking banks to increase
loan loss reserve to 2.5% of total loans, which may add significant
uncertainty to near-term earnings of many medium-sized banks. CCB
and ABC are only two banks not to be affected. 4) Local media (CBN)
said CBRC may introduce a leverage ratio requirement of 4%. All listed
banks indeed largely have met this requirement.   
• Company news: 1) ABC’s senior management expects bank net profit
to exceed Rmb100bn in 2011 on the back of NIM recovery and stable
asset quality. 2) BOC received approval from CBRC for Rmb60bn rights
offering to boost capital ratios. 3) ICBC issued Rmb22bn subordinated
debt to redeem previous issued sub-debts to save interest expenses, no
change to total CAR.  
• Open market operation:  After 2-weeks of liquidity injection, market
liquidity improved last week, as reflected in a 23bps decline in 7-day
Repo rate to 23bps. During last week, total bills issuance was
Rmb110bn, compared with Rmb85bn bills and repo maturity. We expect
the short-term inter-bank rate may continue sliding modestly.  
• Share price performance:  China banks rebounded in H share on
Monday in view of better than expected August macroeconomic data.
Weekly average share prices rose by 0.5%. ABC (+6.8% w/w) is the
single stand-out thanks to senior management’s bullish guidance on 2011
earnings outlook. A-share banks underperformed domestic market given
lingering concern on noises of various policy risks including asymmetric
rate hikes and potential new reserve requirement. Medium-sized banks
were largely down by 4-5% w/w given investors’ concerns about the
earnings impact from new CBRC provision requirement.  
• Valuation and trading perspective:  With the diverging share price
performance between A and H-share market, the discount of A-share
banks vs. H-share banks further expanded to about 16% vs. 12%-13% in
the previous week. H-share banks are trading at 9x forward PE and 1.8x
forward PB on average. In near-term, given uncertainty relating to rate
hikes, and reserves, we believe investors may stick to some bigger banks
with strong deposit franchise (higher percentage of demand deposits and
so less sensitivities to potential asymmetric rate hikes) and higher reserve
levels. Bigger banks in near-term may be a safer place for sector
exposure in near-term.