Banking | Company Research

SWS Research Co. Ltd is a subsidiary of ShenwanHongyuan Securities. 99 East Nanjing Road, Shanghai | +86 21 2329 7818 www.swsresearch.com

Bringing China to the World

Mar 29,2017

买入 维持

业绩平稳 改革可期 交通银行 (3328 HK )

Market Data: Mar 28

Closing Price (HK$) 6.09

Price Target (HK$) 7.60

HSCEI 10411

HSCCI 3963

52-week High/Low (HK$) 6.25/4.51

Market Cap (USD Mn) 58,251

Market Cap (HK$ Mn) 452,261

Shares Outstanding (Mn) 74,263

Exchange Rate (RMB-HK$) 1.13

Price Performance Chart:

Source: Bloomberg

Analyst Vivian Xue A0230511110001 BBE746 xuehr@swsresearch.com

Related Reports "BANK OF COMMUNICATIONS CO-H (3328 HK ) -Upcoming reform" Nov 2, 2016

Financial summary and valuation 2015E 2016E 2017E 2018E 2019E

Net interest income (Rmbm) 144,172 134,871 159,135 177,928 197,698

YOY (%) 6.97 (6.45) 17.99 11.81 11.11

Net income (Rmbm) 66,528 67,210 70,825 75,856 81,869

YOY (%) 1.03 1.03 5.38 7.10 7.93

EPS (Rmb) 0.90 0.89 0.95 1.02 1.10

Diluted EPS (Rmb) 0.90 0.89 0.95 1.02 1.10

BVPS (Rmb) 7.20 8.47 9.64 10.37 11.17

ROAE (%) 13.23 11.55 10.53 10.21 10.24

NPL ratio (%) 1.51 1.52 1.73 1.84 2.03

CAR (%) 13.01 12.51 12.01 12.31 13.31

PE (x) 6.03 6.07 5.66 5.29 4.90

PB (x) 0.75 0.64 0.56 0.52 0.48 Note: Diluted EPS is calculated as if all outstanding convertible securities, such as convertible preferred shares, convertible

debentures, stock options and warrants, were exercised.

业绩符合预期。交行昨日公布 2016 年业绩。期末贷款余额同比增长 10%，存款余额同比

增长 10%。净息差同比下降 34 个基点,环比下降 3 个基点至 1.88%。净利息收入同比下降

6.5%，非利息收入同比增速达到 5%。全年净利润达到 672亿元，基本每股收益 0.89元，

同比增长 1.%，符合我们的预期。公司总资本充足率由 2015年的 13.5%上升至 14.0%。公

司不良率于 2016 年底稳定在 1.52%,2015 年底不良率为 1.51%而 2016 年三季度末不良率

为 1.53%。拨备覆盖率同比上升 0.5 个百分点至 150.5%。公司分红率从 30%小幅上升至

30.5%。

更好的定位。我们认为行业整体的估值修复会在逐渐收紧的货币政策面前逐渐放缓，因

此投资者会更加关注银行的基本面。我们更喜欢那些融资能力强，资产扩展潜力大的银

行。就负债结构来看，交通银行存款占比在 2016 年稳定在 69%而零售存款占比稳定在

32%，高于行业平均的 66%以及 28%。公司核心一级资本充足率和总资本充足率分别为

11.0%和 14.0%，高于行业平均的 9.8%和 12.5%。就资产增长潜力来讲，贷款在资产中的

占比由 2015 年的 57%下降至 55%，而债券投资占比从 2015 年的 21%上涨至 27%。就贷款

结构来讲，贷款中零售贷款占比由 28%上升至 30%。公司广义信贷增长率达到 15%，低于

行业平均的 19%。我们相信公司强大的融资能力使得银行间市场上升的利率对公司的影响

较小。而公司的资产扩张潜力将会更加受益于资产回报率上升。

改革陆续落地。15 年六月中，交行深化改革方案获得中华人民共和国国务院批准同意。

2016 年七月以来，国企改革显著提速，八月国资委宣布国企员工持股试点年内开始。我

们认为如果政府要推进银行业国企员工持股试点，那么交行将是最理想的标的，主要原

因在于：（1）交行改革基因优秀，交行是中国第一家全国股份制银行、第一家完成重

组、第一家引入战略境外投资者、第一家境外公开上市。（2）交行股权基因良好。目前

公司已经形成了国有资本(财政部 27%、社保基金 4%，其他 4%)、境外资本(汇丰银行 19%)

和民营资本共有的股权架构，股权分散程度优于其他四大国有行。（3）交行内生改革诉

求最强。我们认为改革将会包括改善公司管理能力，引入股权激励措施，员工持股计划

以及事业部改革，诸如将特定业务部门分拆上市和优化股权机构。我们相信这些改革能

在中长期提高交行的核心竞争力。

担忧过度。我们将公司 17-19 年 EPS 预测上调至 0.95/1.02/1.10 元人民币同比上涨

5%/7%/8%。目前公司估值对应 0.56倍 2017年 PB，低于市场平均的 0.73倍。我们维持公

司 2017 年目标 PB 为 0.7 倍，将目标价有 7.5 港币上调至 7.6 港币，对应 25%的上行空

间，维持买入评级。

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Banking | Company Research

SWS Research Co. Ltd is a subsidiary of ShenwanHongyuan Securities. 99 East Nanjing Road, Shanghai | +86 21 2329 7818 www.swsresearch.com

Bringing China to the World

Results in line. BOCOM reported 2016 results yesterday. Total loans as of end 2016 grew 10%

YoY and total deposits grew by 10%. Net interest margin declined by 34bps YoY and 3bps QoQ

to 1.88% due to rate cut. Net interest income decreased by 6.5% YoY, while fees and commission

income grew 5% YoY. Net profit arrived at Rmb67.2bn and basic EPS reached Rmb0.89,

representing 1% YoY, in line with our expectation. Its CAR increased from 13.5% at end 2015 to

14.0% by end-2016. Its NPL ratio remained stable at 1.52% in 2016 as compared to 1.51% in

2015 and 1.53% in 3Q16. Its coverage ratio increased by 0.5ppts from 150% in 3Q16 to 150.5%.

Its dividend payout ratio slightly increased from 30.0% in 2015 to 30.5% in 2016.

Better positioned. We believe the sector wide valuation recovery momentum may ease amid

the tightening monetary policy, so investors would focus on banks’ fundamental. We favor banks

with stronger funding capability and larger asset growth potential. In terms of liability structure,

deposit proportion of BOCOM remained stable at 69% in 2016 and the retail deposit proportion

remained stable at 32% in 2016, higher than the sector average level of 66% and 28%. Its core

tier 1 CAR and total CAR reached 11.0% and 14.0% in 2016, higher than the sector average of

9.8% and 12.5%. In terms of asset growth potential, BOCOM keeps prudent in asset allocation

and enjoys larger growth potential. In terms of asset structure, the asset exposure to loans

declined from 57% in 2015 to 55%, while bond investment increased from 21% in 2015 to 27%

in 2016. In terms of loans structure, the loans exposure to high risky industries declined from

28% in 2015 to 25% in 2016 while the exposure to retail loans increased from 28% to 30%. Its

broad based lending growth reached 15% in 2016, lower than sector average of 19%. Its strong

funding capability would make it less impacted by the rising interbank rates, while its larger

growth potential would benefit more from the rising asset yield.

Upcoming reform. In mid-June 2015, BOCOM’s reform scheme obtained the approval of the

State Council. Since July 2016, China SOE reform accelerated. We believe BOCOM would be the

first choice for the government to pilot its SOE reform in the banking sector, due to three

reasons: (1) strong track record of reform and innovation, (2)diversified equity structure,

(3)strong internal motivation. We believe reforms may include improving corporate governance

improvement, introducing management stock incentive, employee stock ownership programs

and conducting business-oriented reform, spinoff and listing of certain business departments

and optimizing share structure. We expect such reforms to improve its competitiveness in the

mid-long term.

Concerns overdone. We revise up our EPS forecasts to Rmb0.95 in 17E (+5% YoY), Rmb1.02 in

18E (+7% YoY) and Rmb1.10 in 19E (+8% YoY). It is trading at 0.56x 17E PB, lower than sector

average of 0.73x. We maintain its target 17E PB at 0.70x and revise our TP from HK$7.50 to

HK$7.60. With 25% upside, we maintain BUY rating.

Please refer to the last page for important disclosures Page 1

Mar 29, 2017 Banking | Company Research

APPENDIX Figure 1: Forecast Income Statement

Rmbm 2008 2009 2010 2011 2012 2013 2014(E) 2015(E) 2016(E) 2017(E) 2018(E) 2019(E)

Interest Income 117,106 116,743 141,905 190,872 240,596 259,292 288,509 305,126 289,844 354,044 391,051 421,709

Interest expense (51,244) (50,075) (56,910) (88,271) (120,470) (128,634) (153,733) (160,954) (154,973) (194,910) (213,123) (224,012)

Net interest income 65,862 66,668 84,995 102,601 120,126 130,658 134,776 144,172 134,871 159,135 177,928 197,698

Fee and commission income 10,121 13,414 17,076 22,464 24,126 29,405 32,914 38,231 39,884 44,972 48,120 51,007

Fee and commission expense (1,284) (2,015) (2,597) (2,915) (3,244) (3,437) (3,310) (3,204) (3,089) (4,497) (4,812) (5,101)

Net fee and commission income 8,837 11,399 14,479 19,549 20,882 25,968 29,604 35,027 36,795 40,475 43,308 45,906

Other operating income 2,577 3,511 4,670 5,152 7,176 8,402 14,156 15,283 22,300 5,002 5,003 5,004

Operating income 77,276 81,578 104,144 127,302 148,184 165,028 178,536 194,482 193,966 204,611 226,239 248,608

Operating expense (25,944) (26,848) (35,513) (40,433) (49,501) (57,812) (60,438) (67,407) (65,493) (69,568) (76,921) (84,527)

Business tax and surcharges (4,923) (5,174) (6,431) (8,939) (8,939) (8,939) (12,822) (13,979) (13,979) (15,757) (17,323) (18,631)

Operating profit before provisions 46,409 49,556 62,200 77,930 89,744 98,277 105,276 113,096 114,494 119,287 131,995 145,450 Provision for impairment losses (10,690) (11,255) (12,246) (12,479) (14,537) (18,410) (20,439) (27,160) (28,480) (28,356) (34,613) (40,358)

Share of profits of an associate - - - - 4 42 90 76 96

Profit before tax 35,719 38,301 49,954 65,451 75,211 79,909 84,927 86,012 86,110 90,930 97,382 105,093

Income tax (7,229) (8,047) (10,782) (14,634) (16,739) (17,448) (18,892) (19,181) (18,459) (20,005) (21,424) (23,120)

Minority interest 97 136 130 82 103 166 185 303 441 101 102 103 Net profit attributable to equity holders of the bank 28,393 30,118 39,042 50,735 58,369 62,295 65,850 66,528 67,210 70,825 75,856 81,869

Source：Company data, SWS Research

Please refer to the last page for important disclosures Page 2

Mar 29, 2017 Banking | Company Research

Figure2: Forecast Balance Sheet

Rmbm 2008 2009 2010 2011 2012 2013(E) 2014(E) 2015(E) 2016(E) 2017(E) 2018(E) 2019(E)

Assets

Cash and Balance with central bank 362,180 434,996 586,554 736,999 816,846 896,556 938,055 920,228 991,435 1,080,664 1,167,117 1,260,487

Cash/balances/Placements with banks and other financial institutions 331,511 222,671 262,976 443,240 520,963 566,429 525,033 611,191 715,787 1,086,197 1,115,064 1,144,232

Loans and advances to customers 1,298,776 1,801,538 2,190,490 2,505,385 2,879,628 3,193,063 3,354,787 3,634,568 4,009,046 4,409,951 4,806,846 5,239,462

Investments 627,727 775,235 809,184 805,829 886,081 1,085,248 1,174,079 1,695,987 2,352,382 2,517,049 2,693,242 2,881,769

Non interest-bearing assets 62,753 74,697 102,389 119,724 169,861 219,641 276,345 293,388 334,516 377,020 405,561 436,393

Total 2,682,947 3,309,137 3,951,593 4,611,177 5,273,379 5,960,937 6,268,299 7,155,362 8,403,166 9,470,880 10,187,830 10,962,342

Liabilities

Deposits/Placements from banks and other financial institutions 569,453 653,172 717,032 854,499 942,989 1,126,563 1,408,275 1,641,239 2,231,060 2,719,181 2,925,025 3,147,394

Deposits from customers 1,865,815 2,372,055 2,867,847 3,283,232 3,728,412 4,157,833 4,029,668 4,574,079 5,047,539 5,501,818 5,941,963 6,417,320

Debts issued 40,000 53,000 52,000 81,803 79,572 106,857 168,148 170,106 229,515 229,515 229,515 229,515

Trading and Derivative liabilities 10,013 - 14,379 18,921 23,060 28,640 28,823 62,461 84,299 84,299 84,299 84,299

Non interst-bearing liabilities 47,571 66,485 76,678 99,934 117,899 119,560 159,780 169,385 178,346 217,365 233,820 251,596

Total 2,532,852 3,144,712 3,727,936 4,338,389 4,891,932 5,539,453 5,794,694 6,617,270 7,770,759 8,752,178 9,414,621 10,130,124

Shareholders' equity

Share capital 48,994 48,994 56,260 61,886 74,263 74,263 74,263 74,263 74,263 74,263 74,263 74,263

Reserves 76,543 88,808 136,572 163,082 227,788 277,968 324,967 387,524 454,181 488,147 524,063 562,592

Retained Earnings 24,125 26,046 29,941 46,834 77,867 67,330 71,825 73,098 100,698 153,128 171,821 192,404

Total shareholders' equity 149,662 163,848 222,773 271,802 379,918 419,561 471,055 534,885 629,142 715,538 770,147 829,259

Minority Interests 433 577 884 986 1,529 1,923 2,550 3,207 3,265 3,164 3,062 2,959

Total shareholders' equity and liabilities 2,682,947 3,309,137 3,951,593 4,611,177 5,273,379 5,960,937 6,268,299 7,155,362 8,403,166 9,470,880 10,187,830 10,962,342

Source：Company data, SWS Research

Please refer to the last page for important disclosures Page 3

Mar 29, 2017 Banking | Company Research

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