The non-performing loan of Zhejiang Merchants Bank increased by 3 billion a year, and the non-performing rate rose to 1.86% _ Sina Finance

Source: Changjiang Business Daily

Reporter: Cai Jia

Under the influence of the epidemic situation and increased efforts to reduce fees and interest rates, Zheshang Bank Last year, the income increased but the profit did not increase.

The annual report shows that in 2020, Zheshang Bank will achieve an operating revenue of 47.703 billion yuan, an increase of 2.89% over the previous year; Net profit attributable to shareholders of the Bank (net profit, the same below) was 12.309 billion yuan, down 4.76% from the previous year.

As of April 5, five of the 21 A-share listed banks that have disclosed their annual reports showed negative performance growth last year, including Shanghai Pudong Development Bank , Zheshang Bank Minsheng Bank Three joint-stock banks.

By the end of 2020, the total assets of Zheshang Bank had exceeded 2 trillion yuan for the first time, reaching 2048.225 billion yuan, an increase of 13.74% over the end of the previous year, and became the ninth listed joint-stock bank in China with assets of more than 2 trillion yuan. Among them, the total amount of loans and advances increased by 16.26%, and the proportion of net loans and advances in total assets rose to 56.92%.

But at the same time, with the expansion of interest bearing assets, Zheshang Bank is also faced with the negative impact of increased credit risk and the strengthening of fee and interest reduction on profitability.

By the end of 2020, the non-performing loan ratio of Zheshang Bank had risen slightly to 1.42%. The increase of non-performing loans mainly came from its core corporate business. At the end of the period, the bank's corporate non-performing loans amounted to 14.64 billion yuan, an increase of 3.033 billion yuan over the end of the previous year. The non-performing loan ratio was 1.86%, up 0.15 percentage points over the end of the previous year.

　　 Both net interest margin and net interest yield declined

As one of the 12 national joint-stock commercial banks, Zheshang Bank was opened in 2004, listed in Hong Kong in March 2016, and returned to A in November 2019, becoming the 13th "A+H" listed bank in China.

Compared with other joint-stock banks, Zhejiang Merchants Bank has not been established for a long time, but its business scale expanded rapidly in the early years. In the eighth year of its establishment, its revenue exceeded 10 billion, and its net profit in the first year of listing in Hong Kong exceeded 10 billion, with a rapid development speed.

However, in recent years, the performance growth of Zhejiang Merchants Bank has slowed down significantly, especially under the impact of the epidemic last year, the real economy has intensified efforts to reduce fees and allow profits, making the bank increase income without increasing profits.

Data shows that after the year-on-year increase of 33.98% and 44% in revenue and net profit in 2016 to 33.502 billion yuan and 10.153 billion yuan, from 2017 to 2020, Zheshang Bank realized operating revenue of 34.222 billion yuan, 38.943 billion yuan, 46.364 billion yuan and 47.703 billion yuan respectively, with year-on-year growth of 2.15%, 13.8%, 19.06% and 2.89%, and net profit of 10.95 billion yuan, 11.49 billion yuan, 12.924 billion yuan and 12.309 billion yuan, The year-on-year growth rate was 7.85%, 4.94%, 12.48% and -4.76%.

It can be seen that in 2017, the performance growth of Zhejiang Merchants Bank fell back to single digits. In 2019, the first year of A-share listing, the performance growth returned to more than 10%. In 2020, the performance declined, which is the first time that the annual net profit of Zhejiang Merchants Bank has seen negative growth since its establishment.

It is worth mentioning that the overall performance of A-share listed banks was better than the industry average under the pressure of the general performance growth of the banking industry last year.

According to the data disclosed by the CBRC, in 2020, China's commercial banks achieved a cumulative net profit of 1.94 trillion yuan, a year-on-year decrease of 2.7%, 5.6 percentage points narrower than the first three quarters.

As of April 5, among the 21 A-share listed banks that have disclosed their annual reports, the growth rate of annual net profits of 16 banks has recovered. Among listed joint-stock banks, the net profits of five banks, including China Merchants, Ping An, CITIC, Everbright and Industrial, increased by 4.82%, 2.6%, 2.01%, 1.26% and 1.15% year on year, while the annual net profits of three joint-stock banks, Pudong Development, Zhejiang Merchants and Minsheng, grew negatively.

From a single quarter perspective, the decline of Zheshang Bank's performance mainly occurred in the second and third quarters of last year, with a decline of 27.32% and 9.22% respectively. In the fourth quarter, Zhejiang Merchants Bank realized an operating revenue of 12.464 billion yuan and a net profit of 2.165 billion yuan, up 4.21% and 28.49% year on year. The growth rate of net profit increased by 37.71 percentage points month on month, and increased for two consecutive quarters.

From the perspective of income structure, the net interest income is still the main source of income of Zheshang Bank. In 2020, Zheshang Bank realized a net interest income of 37.095 billion yuan, up 7.02% year on year, accounting for 77.76% of operating income. However, the net interest margin and net interest yield were 1.99% and 2.19% respectively, down 0.14 percentage points and 0.20 percentage points respectively from the previous year.

In contrast to the growth of net interest income, during the reporting period, the non interest net income of Zheshang Bank was 10.608 billion yuan, a year-on-year decrease of 9.35%. Among them, the net income from handling fees and commissions was 4.25 billion yuan, up 12.11% year on year, and the net loss from changes in fair value was 1.88 billion yuan. The net loss increased by 1.536 billion yuan compared with the previous year, resulting in a year-on-year decrease of 19.63% in other non interest net income to 6.358 billion yuan.

　　 Non performing rate of some industries exceeds 5%

In response to the regulatory call, the asset liability structure of Zheshang Bank has been significantly adjusted under the effect of improving the service to the real economy.

By the end of 2020, the total assets of Zheshang Bank had reached 2048.225 billion yuan, an increase of 13.74% over the end of the previous year. This was the first time that the total assets of Zheshang Bank had exceeded the threshold of 2 trillion yuan, and it became the ninth listed joint-stock bank in China with assets of more than 2 trillion yuan. Among them, the total amount of loans and advances issued was 1197.698 billion yuan, up 16.26% over the end of the previous year. Net loans and advances accounted for 56.92% of total assets, up 1.45 percentage points over the end of last year.

It is worth mentioning that in recent years, Zheshang Bank has innovated the platform based service model and improved its ability to obtain customers. By the end of 2020, the Bank's total corporate loans had amounted to 788.066 billion yuan, an increase of 15.96% over the end of the previous year, accounting for 65.8% of the total loans.

However, under the impact of the epidemic last year, the quality of credit assets of Zhejiang Merchants Bank, which focuses on corporate business, fluctuated. By the end of 2020, the Bank's non-performing loans had amounted to 17.045 billion yuan, an increase of 2.898 billion yuan over the end of the previous year, the non-performing loan ratio was 1.42%, an increase of 0.05 percentage points over the end of the previous year, and the provision coverage rate was 191.01%, a decrease of 29.79 percentage points over the end of the previous year.

Among them, the non-performing loan of the company was 14.64 billion yuan, an increase of 3.033 billion yuan over the end of the previous year, and the non-performing loan ratio was 1.86%, up 0.15 percentage points over the end of the previous year.

In contrast, at the end of last year, the Bank's total personal loans amounted to 333.108 billion yuan, an increase of 20.83% over the end of the previous year, with a relatively high growth rate. However, personal non-performing loans amounted to 2.399 billion yuan, a decrease of 86 million yuan over the end of the previous year, and the non-performing loan ratio was 0.72%, a decrease of 0.18 percentage points over the end of the previous year.

"On the one hand, affected by the economic and financial situation at home and abroad, the prosperity of some traditional industries has declined. In addition to the impact of the epidemic, the resumption of production and work of enterprises has been delayed, leading to the tension in the capital chain of some enterprises." Liu Long, Vice President and Secretary of the Board of Directors of Zhejiang Merchants Bank, responded to this.

The reporter of Changjiang Business Daily noted that by the end of 2020, the non-performing loans of Zheshang Bank were mainly concentrated in manufacturing, wholesale and retail, leasing and business services and other industries. Among them, the non-performing loans of manufacturing companies increased from 6.203 billion yuan at the end of last year to 8.187 billion yuan, and the non-performing ratio increased from 5.41% to 6.01%. The non-performing loans of companies in other industries, including public management and social organizations, culture, sports and entertainment, soared from 401 million yuan at the end of last year to 2.684 billion yuan, and the non-performing ratio also increased from 1.36% to 7.74%.

However, in order to enhance the ability to resist risks, Zheshang Bank increased the provision provision last year. According to the annual report, in 2020, Zheshang Bank accrued a total of 20.166 billion yuan of credit impairment losses, an increase of 6.69% year on year. Among them, the impairment loss of loans and advances was 9.877 billion yuan, up 29.28% year on year.

In addition, on the liability side, by the end of 2020, the balance of deposits taken by Zheshang Bank had reached 1335.636 billion yuan, an increase of 191.895 billion yuan or 16.78% over the end of the previous year, and its share in total liabilities had further risen to 69.73%.

In terms of capital adequacy, as of the end of 2020, the capital adequacy ratio of Zheshang Bank was 12.93%, the tier one capital adequacy ratio was 9.88%, and the core tier one capital adequacy ratio was 8.75%, down 1.31, 1.06, and 0.89 percentage points respectively from the end of the previous year.