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<Research>HSBC Global Research Prefers ICBC & CCB for Div., CM BANK for Improved Risk Appetite
Recommend 68 Positive 111 Negative 62 |
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HSBC Global Research highlighted in a report that the 1Q24 EPS of large mainland banks fell by low single-digits, slightly below market expectations. However, given the banks' low P/E ratios of 3.2x to 5.5x, the broker believed the market would pay more attention to EPS sustainability than quarterly figures. Dividend attractiveness was reaffirmed as the "Big 4" banks and BANKCOMM (03328.HK) considered paying interim dividends in 2024 for the first time. The broker predicted details to be announced in the banks' interim results. Meanwhile, the CET1 ratios of the "Big 4", BANKCOMM and CM BANK (03968.HK) improved more than expected, up 5 to 96 bps QoQ, partly due to the new capital framework and balance sheet portfolio adjustments. Net interest margins of mainland banks were slightly better than expected in 1Q. HSBC identified two investment themes for the Chinese bank sector. The first one is dividends, with a preference for ICBC (01398.HK) and CCB (00939.HK). The second one is CM BANK's improved risk appetite and sustainable business model. AAStocks Financial News |
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