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<Research>Citi Expects CN Banks' Earnings to be Flattish YoY in 1H25
Recommend 26 Positive 65 Negative 31 |
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Citi released a report predicting that the covered Chinese banks will see a reduced revenue decline in 1H25, with a projected YoY downfall of 0.1%. This was due to a smaller NIM compression and alleviated pressure on trading gain in 1H25, as the 10-year China treasury bond yield was expected to drop to 1.65% by the end of 2Q25. In alignment, the pressure on earnings is likely to ease sequentially, with earnings expected to remain flat YoY in 1H25, improving from a 1.3% YoY decline in 1Q25. The broker assumed that the better-than-expected macro conditions in 2Q25 may entice banks to maintain counter-cyclical provisioning practices to preserve a larger earnings buffer and make room for more provision releases expected in 2H25. Among major SOE banks, ABC (01288.HK) and BANKCOMM (03328.HK) are likely to achieve faster profit growth than peers in 2Q25; ICBC (01398.HK), PU DEV BANK (600000.SH), and BANK OF BJ (601169.SH) are expected to report 2Q25 results beating street consensus. Conversely, CM BANK (03968.HK) may underperform expectations. AASTOCKS Financial News Website: www.aastocks.com |
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