The independent financial analyst theScreener just slightly lowered the general evaluation of INDL.& CMLBK.OF CLTD. (HK), active in the Money Center Banks industry. The title has lost a star(s) at the fundamental level and now shows 3 out of 4 stars. Its exposure to market risk remains nonetheless the same and can be still described as defensive. theScreener slightly downgrades the general evaluation to Slightly Positive for the title on account of the lost star(s). As of the analysis date March...
On Tuesday, the media reported that Shanghai Pudong Development Bank, along with China Merchants Bank, or CMB, and Bank of Communications, or BOCOM, were found in contempt for refusing to comply with subpoenas in a North Korea sanctions violation investigation conducted by a U.S. judge. The H-Shares of CMB and BOCOM declined by 7.7% and 3.7%, respectively, though both companies officially denied involvement in any investigations related to possible violations of sanctions, and are in compliance ...
On Tuesday, the media reported that Shanghai Pudong Development Bank, along with China Merchants Bank, or CMB, and Bank of Communications, or BOCOM, were found in contempt for refusing to comply with subpoenas in a North Korea sanctions violation investigation conducted by a U.S. judge. The H-Shares of CMB and BOCOM declined by 7.7% and 3.7%, respectively, though both companies officially denied involvement in any investigations related to possible violations of sanctions, and are in compliance ...
Industrial and Commercial Bank of China, or ICBC, is China's largest bank. We think its leading scale efficiency and funding advantages endow it with a narrow economic moat.ICBC has a long-established reputation for mass-market retail banking and enjoys low funding costs in the industry. Its established relationships with households, unmatched convenience via more than 16,000 domestic outlets, and brand backed by government credit combine to reward it with the largest retail deposit base, repres...
Despite Industrial and Commercial Bank of China's solid results, we retain our CNY 6.50 per share fair value estimate for the China A-shares, and HKD 7.50 for H-shares as results were largely in line. Net profit increased 4.1% from 2017. The results stood out with a better-than-peer performance in net interest margin and strong improvement in operating efficiency. Boosted by the 19% revenue growth and a 304 basis point improvement in cost/income ratio, growth in preprovision operating profits ac...
Despite Industrial and Commercial Bank of China's solid results, we retain our CNY 6.50 per share fair value estimate for the China A-shares, and HKD 7.50 for H-shares as results were largely in line. Net profit increased 4.1% from 2017. The results stood out with a better-than-peer performance in net interest margin and strong improvement in operating efficiency. Boosted by the 19% revenue growth and a 304 basis point improvement in cost/income ratio, growth in preprovision operating profits ac...
Despite Industrial and Commercial Bank of China's solid results, we retain our CNY 6.50 per share fair value estimate for the China A-shares, and HKD 7.50 for H-shares as results were largely in line. Net profit increased 4.1% from 2017. The results stood out with a better-than-peer performance in net interest margin and strong improvement in operating efficiency. Boosted by the 19% revenue growth and a 304 basis point improvement in cost/income ratio, growth in preprovision operating profits ac...
Industrial and Commercial Bank of China, or ICBC, is China's largest bank. We think its leading scale efficiency and funding advantages endow it with a narrow economic moat.ICBC has a long-established reputation for mass-market retail banking and enjoys low funding costs in the industry. Its established relationships with households, unmatched convenience via more than 16,000 domestic outlets, and brand backed by government credit combine to reward it with the largest retail deposit base, repres...
Following Industrial and Commercial Bank of China's solid results including net profit increasing 4.1% from 2017, we retain our CNY 6.50 per share fair value estimate for the A-shares, and HKD 7.50 for H-shares as results were largely in line. Net profit growth came in slightly below our 5% expectation as a result of increased provision expenses, while growth in preoperating provision profits, or PPOP, remained steady at 9%. In our view, such high growth indicated ICBC’s strong top line growth...
Following Industrial and Commercial Bank of China's solid results including net profit increasing 4.1% from 2017, we retain our CNY 6.50 per share fair value estimate for the A-shares, and HKD 7.50 for H-shares as results were largely in line. Net profit growth came in slightly below our 5% expectation as a result of increased provision expenses, while growth in preoperating provision profits, or PPOP, remained steady at 9%. In our view, such high growth indicated ICBC’s strong top line growth...
Following Industrial and Commercial Bank of China's solid results including net profit increasing 4.1% from 2017, we retain our CNY 6.50 per share fair value estimate for the A-shares, and HKD 7.50 for H-shares as results were largely in line. Net profit growth came in slightly below our 5% expectation as a result of increased provision expenses, while growth in preoperating provision profits, or PPOP, remained steady at 9%. In our view, such high growth indicated ICBC’s strong top line growth...
Following the People's Bank of China's announcement that it will launch central bank bill swaps to improve the liquidity of banks' perpetual bonds, we’re maintaining our fair value estimates for the Chinese banks we cover. According to the central bank’s statement, primary dealers engaged in an open-market operation are allowed to swap the perpetual bonds they hold for the central bank bills. Banks' perpetual bonds with ratings no lower than AA will be included as qualified collateral for a ...
Following the People's Bank of China's announcement that it will launch central bank bill swaps to improve the liquidity of banks' perpetual bonds, we’re maintaining our fair value estimates for the Chinese banks we cover. According to the central bank’s statement, primary dealers engaged in an open-market operation are allowed to swap the perpetual bonds they hold for the central bank bills. Banks' perpetual bonds with ratings no lower than AA will be included as qualified collateral for a ...
We see China’s latest cut in its reserve requirement ratio as having limited impact on the valuations of the Chinese banks we cover. We believe the benefits of liquidity injection are largely offset by downward pressure on net interest margin, given weaker loan pricing and intense deposit competition. Our top picks are Agricultural Bank of China and Industrial & Commercial Bank of China, which are trading at 29% and 26% discounts to our fair value estimates, respectively. Assuming other assum...
We see China’s latest cut in its reserve requirement ratio as having limited impact on the valuations of the Chinese banks we cover. We believe the benefits of liquidity injection are largely offset by downward pressure on net interest margin, given weaker loan pricing and intense deposit competition. Our top picks are Agricultural Bank of China and Industrial & Commercial Bank of China, which are trading at 29% and 26% discounts to our fair value estimates, respectively. Assuming other assu....
With growth in revenue and net profit accelerating to 7.7% and 5.1%, respectively, from the year-ago period, narrow-moat Industrial and Commercial Bank of China delivered another set of strong results in the first three quarters. Given the results representing 80% of our projected full-year net profit, the bank is well on track to deliver our forecast 5.8% net profit growth in 2018. The results highlighted its faster-than-peer deposit growth, steady credit quality, and improving operating effici...
With growth in revenue and net profit accelerating to 7.7% and 5.1%, respectively, from the year-ago period, narrow-moat Industrial and Commercial Bank of China delivered another set of strong results in the first three quarters. Given the results representing 80% of our projected full-year net profit, the bank is well on track to deliver our forecast 5.8% net profit growth in 2018. The results highlighted its faster-than-peer deposit growth, steady credit quality, and improving operating effici...
On Oct. 7, People's Bank of China announced a 1-percentage-point reduction in the Chinese central bank’s required reserve ratio effective Oct. 15. This is the third RRR cut in 2018 following the 100- and 50-basis-point cuts announced in April and June. We retain our fair value estimates for the Chinese banks as we believe the benefits of liquidity injection are largely offset by weaker loan pricing and higher credit costs as the economy is facing mounting challenges both domestically and exter...
On Oct. 7, People's Bank of China announced a 1-percentage-point reduction in the Chinese central bank’s required reserve ratio effective Oct. 15. This is the third RRR cut in 2018 following the 100- and 50-basis-point cuts announced in April and June. We retain our fair value estimates for the Chinese banks as we believe the benefits of liquidity injection are largely offset by weaker loan pricing and higher credit costs as the economy is facing mounting challenges both domestically and exter...
With growth in revenue and net profit accelerating to 7% and 4.9%, respectively, from the year-ago period, narrow-moat Industrial and Commercial Bank of China delivered another set of strong results in the first half. With the results representing 52% of our projected full-year net profit, ICBC is well on track to deliver our forecast 5% net profit growth in 2018. Though bottom-line growth seemed unimpressive, growth in core revenue including net interest income and fee income were both at the h...
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