A-share listed banks' "mid-term exam" report cards are being released one after another.

As of August 19th, a total of four listed banks have disclosed their semi-annual performance reports, which are Nanjing Bank, Ping An Bank, Jiangsu Bank, and Shanghai Rural Commercial Bank. In addition, there are six listed banks that have disclosed performance quick reports, which include two joint-stock banks, Shanghai Pudong Development Bank and China Zheshang Bank, two city commercial banks, Bank of Hangzhou and Qilu Bank, and two rural commercial banks, Rui Feng Bank and Suzhou Agricultural Bank.

Overall, among the ten banks that disclosed performance quick reports or performance reports, eight banks achieved growth in both revenue and net profit in the first half of the year. Overall, the net interest margin has further narrowed, with non-interest business providing certain support, and the non-performing loan ratio has stabilized and decreased.

Industry insiders analyze that in the first half of the year, the coordination and promotion of quantity and price have further balanced, asset quality has been further consolidated, and performance has remained stable. It is expected that the overall expansion of the balance sheet and the growth rate of performance of listed banks in the first half of the year will remain stable.

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Eight banks achieved double growth in revenue and net profit

Among the ten listed banks that disclosed performance quick reports or semi-annual reports, eight achieved year-on-year growth in both revenue and net profit, with Ping An Bank and Shanghai Pudong Development Bank being the two banks with declining operating income.

Specifically, Rui Feng Bank had the largest increase in operating income, 14.9%, followed by Suzhou Agricultural Bank with a year-on-year increase of 8.02%. Nanjing Bank and Jiangsu Bank achieved revenue increases of 7.87% and 7.16%, respectively, reaching 26.216 billion yuan and 41.625 billion yuan. Qilu Bank and Bank of Hangzhou had growth rates of 5.53% and 5.36%, respectively, reaching 608 million yuan and 18.356 billion yuan. Shanghai Rural Commercial Bank slightly increased by 0.23% to 13.917 billion yuan.

Ping An Bank experienced a decline in revenue scale, with a year-on-year decrease of 12.95%; Shanghai Pudong Development Bank decreased by 3.27%, to 88.248 billion yuan. Another joint-stock bank, China Zheshang Bank, achieved a revenue increase of 6.18%.

In terms of net profit growth, six listed banks achieved double-digit growth. Bank of Hangzhou had the fastest growth rate of 20.06%, with net profit attributable to the parent company of 9.996 billion yuan; Qilu Bank, Suzhou Agricultural Bank, and Rui Feng Bank achieved growth rates of 16.98%, 15.81%, and 15.48%, respectively. Jiangsu Bank's growth rate was 10.05%, achieving a net profit of 18.731 billion yuan.

In addition, Nanjing Bank's growth rate was 8.51%, achieving a net profit of 11.594 billion yuan. Under the premise of a slight increase in revenue, Shanghai Rural Commercial Bank's net profit growth was minimal, increasing by 0.62% to 6.928 billion yuan. Although Ping An Bank experienced a decline in revenue, its net profit achieved a growth rate of 1.94%, to 25.879 billion yuan; Shanghai Pudong Development Bank also achieved a net profit growth rate of 16.64%.Non-interest Income Growth and Decline in Non-performing Loan Ratio

Overall, the operating income of listed banks has shown a certain degree of slowdown, but net profits have maintained a relatively high growth, which is attributed to the contribution of non-interest business to revenue. Looking at the banks that have disclosed non-interest income, many have performed well in non-interest business in the first half of the year. Specifically, Nanjing Bank achieved non-interest income of 13.405 billion yuan, a year-on-year increase of 25.51%, accounting for 51.13% of the operating income, surpassing interest income. Jiangsu Bank's non-interest income was 13.969 billion yuan, a year-on-year increase of 19.74%. Among them, the middle business income was 3.03 billion yuan, a year-on-year increase of 11.3%. The bank disclosed in its report that the main contribution came from agency business, and the development of retail wealth management is in good momentum.

On the other side of non-interest business contributing to revenue, the net interest margin of listed banks continues to be compressed. From the financial reports of banks that have disclosed the net interest margin level, it can be seen that both joint-stock banks and urban and rural commercial banks have experienced a certain degree of decline in net interest margin. Ping An Bank, while experiencing a significant decrease in revenue, saw its net interest margin decrease by 0.59 percentage points year-on-year to 1.96%, breaking through the 2% mark, and reaching the lowest value in the past five years. Shanghai Rural Commercial Bank's net interest margin fell to 1.56%, a year-on-year decrease of 16 basis points. Jiangsu Bank's net interest margin is 1.9%, down by 8 basis points from the end of 2023.

The continuous change in the source of operating income poses challenges to the banks' operations. During the reporting period, the non-performing loan ratio of listed banks has shown a certain decline. According to the reporter's statistics, five listed banks saw a decrease in the non-performing loan ratio in the first half of the year, four remained the same as at the end of the previous year, and Ping An Bank is the only listed bank that saw an increase in the non-performing loan ratio.

Zhejiang Commercial Bank's non-performing loan ratio in the first half of this year decreased by 0.01 percentage points from the end of the previous year to 1.43%, and Shanghai Pudong Development Bank decreased by 0.07 percentage points to 1.41%. Jiangsu Bank's non-performing loan ratio is 0.89%, setting a new historical low.

Hangzhou Bank's non-performing loan ratio remained unchanged from the end of the previous year, at 0.76%, and Rui Feng Bank's non-performing loan ratio is 0.97%, also unchanged from the end of the previous year. The non-performing loan ratios of Suzhou Agricultural Bank and Hangzhou Bank are also the same as at the beginning of the year. Ping An Bank's non-performing loan ratio slightly increased by 0.01 percentage points, to 1.07%.

Dividend Plans Become a Focus

As revenue and net profit show certain signs of stabilization, the dividend plans of listed banks have also become a highlight of this mid-term report disclosure. Among the listed banks that have disclosed their half-year "report cards," two have confirmed their interim dividend plans. Ping An Bank stated that the bank plans to pay a cash dividend of RMB 2.46 (including tax) per 10 shares, totaling RMB 4.774 billion in cash dividends, accounting for 18.4% of the net profit attributable to the bank's shareholders in the consolidated statement.

Shanghai Rural Commercial Bank also offered a cash dividend of RMB 2.39 (including tax) per 10 ordinary shares, totaling RMB 2.305 billion (including tax). Overall, the bank's 2024 interim dividend ratio is 33.07%.

The market generally analyzes that, judging from the performance quick reports and reports disclosed by the listed banks, the performance is generally stable, and it is expected to maintain a stable trend overall, laying a solid foundation for dividends. "From the perspective of sector investment, current bank stocks are supported by policy support and performance stability, coupled with the unchanged logic of financial product allocation preferences, the dividend income space is strongly determined." CITIC Securities analyst Xiao Feifei pointed out.Xiao Feifei analyzed that currently, 10 listed banks have disclosed their interim reports or flash reports. Overall, in the first half of the year, the coordination between volume and price has been promoted to rebalance, asset quality has been further consolidated, and performance has remained stable. It is expected that the overall expansion of the balance sheet and the growth rate of performance of listed banks in the first half of the year will remain steady.

Zhou Maohua, an analyst at the financial market department of China Everbright Bank, also believes that the recent performance flash reports published by several small and medium-sized banks are eye-catching and are quite consistent with the recovery of the domestic economy. It is expected that the overall operation of banks in the first half of the year will remain stable, and asset quality will be maintained.

However, some opinions point out that against the backdrop of insufficient effective demand, the scale expansion of the banking industry has slowed down, and under the situation of reduced volume and reduced prices, it is difficult to expect an improvement in the growth rate of bank performance in the short term. Lin Jin, the chief analyst of the banking industry at Industrial Securities, pointed out that in the first half of this year, the revenue and net profit of the banking industry are still under pressure, continuing a slight negative growth.