CCB and BANKCOMM reduce dividend payouts; ICBC earns 368.5 billion last year, ranking first; management hopes to increase dividend payout ratio

Among the state-owned commercial banks, three announced their annual results yesterday. Industrial and Commercial Bank of China (ICBC) (1398) earned the most last year, with a net profit attributable to shareholders of RMB 368.562 billion, a year-on-year increase of 0.7%. However, the profit growth was lower than that of China Construction Bank (CCB) (939) and Bank of Communications (BOC) (3328). In terms of dividends, ICBC, CCB, and BOC declared final dividends of RMB 0.1689, RMB 0.2029, and RMB 0.1684 per share, respectively. For the whole year, ICBC is currently the only state-owned commercial bank to increase its dividend, while CCB and BOC both reduced their annual dividends, with BOC's reduction reaching 14.3%. ICBC's Annual Dividend of RMB 0.3103, Up 0.7% ICBC's President Liu Jun stated that the bank's capital planning and dividend arrangements will be dynamically adjusted based on the market. If there is a call from the capital market for a further increase in the dividend payout ratio, ICBC, as a market barometer, will certainly "respond to the market's urgency and desires." The bank will closely monitor changes and demands in the capital market and adjust its dividend arrangements in a timely manner. Last year, ICBC's total dividend, including the interim dividend, was RMB 0.3103, an increase of 0.7% year-on-year, with a payout ratio of 31%. CCB's Dividend Decreased by 3.5%, BOC's Reduced by 14% CCB recorded a net profit attributable to shareholders of RMB 338.906 billion last year, an increase of nearly 1% year-on-year, with an annual dividend of RMB 0.3887, a decrease of 3.5% year-on-year. BOC's net profit attributable to shareholders was RMB 95.622 billion, a year-on-year increase of 2.18%, which was better than ICBC and CCB, but its annual dividend decreased by 14.3% to RMB 0.3247. During the period, ICBC's net interest income fell by 0.4% year-on-year to RMB 635.126 billion, while net fee and commission income rose by 1.6% to RMB 111.171 billion. CCB's net interest income fell by 2.9% to RMB 572.774 billion, while net fee and commission income rose by 5.1% to RMB 110.307 billion. As for BOC, its net interest income rose by 1.9% to RMB 173.075 billion, and net fee and commission income increased by 3.4% to RMB 38.183 billion. Net Interest Margin Continues to Be Under Pressure, Downward Trend Expected to Slow The net interest margin of mainland banks continues to be under pressure. Last year, ICBC's net interest margin narrowed by 14 basis points to 1.28%, CCB narrowed by 17 basis points to 1.34%, and BOC narrowed by 7 basis points to 1.2%. ICBC's Vice President Yao Mingde expects that this year, the downward trend of the bank's net interest margin will continue to slow, and net interest income is expected to turn positive. CCB's Chief Financial Officer Sheng Liurong pointed out that regulators continue to emphasize improving the market-oriented interest rate formation and transmission mechanism and reducing banks' liability costs. The bank will continue to optimize its asset-liability structure and is confident that it will further narrow the net interest margin this year. BOC's Executive Director and Vice President Zhou Wanfeng indicated that there is still downward pressure on loan rates this year, but liability pricing will bring benefits, and it is expected that the net interest margin will maintain a stable and positive trend throughout the year. Non-Performing Loan Ratio Slightly Decreased by 0.03 Percentage Points As of the end of last year, the non-performing loan ratio for ICBC and CCB was both 1.31%, while BANKCOMM was 1.28%. The ratio for the three banks decreased by an average of 0.03 percentage points year-on-year. BANKCOMM's Vice President Gu Bin expects that this year's asset quality control will still face certain pressures, thus focusing on factors such as the decline in personal repayment ability and market demand, the impact on retail credit and small enterprises, as well as related risks in the real estate sector. CCB's Vice President Li Jianjiang stated that current retail risk control remains a priority, and with the further implementation of various mechanisms and measures, they are confident in maintaining overall stability in retail credit asset quality. CMB earned 1.2% more last year and declared a final dividend of 1.003 yuan In addition, China Merchants Bank (3968) announced a net profit of 150.181 billion yuan last year, an increase of 1.2% year-on-year, and declared a final dividend of 1.003 yuan