How to break the "curse" of low stock price with frequent auctions of large shares, twists and turns in the disposal of non-performing assets, and pressure on net profit and asset quality.
Zhongyuan Bank shares*** hereinafter referred to as: Zhongyuan Bank, 1216HK) The disposal of non-performing assets of credit cards encountered twists and turns, and the announcement of the transfer of non-performing loans in the third phase of the non-performing loans posted on Yindeng.com was not successfully traded, and had to be listed again. On December 13, Zhongyuan Bank re-listed the announcement on the transfer of non-performing loans for credit cards in 2023.
Zhongyuan Bank credit card non-performing transfer second listing: Yindeng.com).
The disposal of credit card non-performing cards was blocked, and the equity of Zhongyuan Bank was also frequently auctioned by shareholders. On December 27, YTO announced that the company's holding subsidiary, YTO (Luoyang) Diesel Engine, hereinafter referred to as "YTO Diesel Engine") intends to transfer its holdings of Zhongyuan Bank 3 through public listing and transfer on the Beijing Equity Exchange2.3 billion shares, corresponding to a shareholding ratio of 08827%, and the counterparty will pay the consideration in cash in a lump sum. In addition, the equity of Zhongyuan Bank has also been auctioned on major platforms repeatedly. According to statistics, on platforms such as Ali Auction, Zhongyuan Bank has a total of 3300 million yuan of equity and debt are being auctioned publicly, but no one has signed up yet.
Equity has been auctioned repeatedly, high-level personnel changes are extremely frequent, performance "increases revenue but not profits", and the net profit attributable to the parent company has increased and asset quality is under pressure
In response to issues such as credit card non-performing disposal, equity auction, business performance, and equity governance, Discovery.com sent an interview and research letter to Zhongyuan Bank, but as of press time, Zhongyuan Bank did not give a reasonable explanation on the relevant issues.
The disposal of non-performing assets of credit cards has encountered twists and turns
The listing and transfer of non-performing assets has become the main channel for banks to speed up the disposal of non-performing assets and write-off, but the disposal of non-performing assets of Zhongyuan Bank's credit card has encountered twists and turns, and the third phase of the non-performing loan transfer announcement listed on Yindeng.com has not been successfully traded, and it has to be listed again. On December 13, Zhongyuan Bank re-listed the announcement on the transfer of non-performing loans for credit cards in 2023.
Screenshot of Zhongyuan Bank's credit card non-performing loan listed for the first time: Yindeng.com).
According to the information queried, except for some changes in the bidding time, the other main information has not changed much. According to statistics, since the beginning of this year, Zhongyuan Bank has listed 7 phases of credit card non-performing loan transfer announcements on Yindeng's website, with a total outstanding principal and interest of more than 1 billion yuan. At present, Yindeng only discloses the announcement of the bank's first transfer results.
Zhongyuan Bank credit card bad transfer information statistics: **Yindeng.com).
It is worth noting that, unlike the announcements on the transfer of credit card non-performing assets published by other banks on Yindeng.com, Zhongyuan Bank's non-performing loans of more than 1 billion yuan are all in a state of unwritten off.
According to the 2023 mid-year report of Zhongyuan Bank, as of June 30, 2023, the cumulative number of credit cards issued by Zhongyuan Bank was 390940,000, an increase of 27 from the end of 2022460,000 sheets;The amount of credit card transactions is 6178.8 billion yuan, a year-on-year increase of 586%；The balance of the loan is 2116.2 billion yuan.
In addition, under the "other" personal loan of Zhongyuan Bank, the loan amount is 2116.2 billion yuan, which is consistent with the balance of credit card loans. It is estimated that the balance of non-performing loans of Zhongyuan Bank's credit card at the end of the first half of 2023 is 96.6 billion yuan, with a defective rate of 457%。
It is worth mentioning that at the end of 2022, the balance of credit card loans of Zhongyuan Bank was 2202.5 billion yuan, and the balance of non-performing loans was 62.7 billion yuan, with a defective rate of 285%。Half a year later, the bank's non-performing loan balance increased by 33.9 billion yuan, and the defective rate increased by 172%。
Through the comparison of data, it can be seen that the non-performing credit card has increased the overall non-performing level of Zhongyuan Bank. Data show that in the first half of this year, the balance of non-performing loans of Zhongyuan Bank was 1587.1 billion yuan, an increase of 26 from the end of the previous year7.2 billion yuan;The non-performing loan ratio is 219%, an increase of 026 percentage points.
A number of large stakes were auctioned, and the stability of the equity was questionable
The bad disposal of credit cards has encountered twists and turns, and the equity of Zhongyuan Bank is not welcomed, with both equity ** and a number of large equity auctions. On December 27, YTO announced the major assets plan, and the company's holding subsidiary, YTO Diesel Engine, intends to transfer its holdings of Zhongyuan Bank 3 through the Beijing Equity Exchange2.3 billion shares, corresponding to 08827% equity. The reserve price for the listing and transfer of the above-mentioned equity of Zhongyuan Bank is about RMB 66.8 billion yuan.
Source: YTO share announcement).
At the same time, equity auctions of Zhongyuan Bank are also common. Recently, 70 million domestic shares of Zhongyuan Bank have been playing 7In the case of 65% off, the second auction was still unsold, which attracted attention. According to the Ali judicial auction network, the starting price of the above-mentioned 70 million domestic shares of Zhongyuan Bank is about 2950610,000 yuan, 7 compared with the appraisal price65% off, this equity was auctioned for the first time on November 11, 2023, with a starting price of 3278450,000 yuan, 8 compared with the appraisal price5% off, both times because no one bid.
In addition, Henan Xingda Investment*** holds about 27.7 billion shares will be sold from 10 a.m. on November 20, 2023 to 10 a.m. on January 19, 2024 at a price of approximately 31.4 billion yuan, 7 percent higher than the appraised price82% off, currently showing that no one has registered. This equity was auctioned for the first time and the second auction on October 1, 2023 and October 30, 2023, with a starting price of about 34.9 billion yuan, 31.4 billion yuan, all of which were unsold due to no bidders.
As of December 2023, there have been 25 auctions related to Zhongyuan Bank's equity and claims on the Ali judicial auction platform, of which only 5 have been successfully auctionedThere are also 3 ongoing auctions, including bid 3A large equity auction of 1.4 billion yuan, but no one has signed up at present, and the remaining 17 have been unsold.
Zhongyuan Bank's past equity auction information: Ali judicial auction platform).
According to incomplete statistics, since the beginning of this year, Zhongyuan Bank has successfully completed 6 auction transactions, and there are three transactions of more than 9 million. Among them, the highest sum was 9.96 million yuan, and after 1,155 onlookers, 1 person signed up to successfully auction it. The starting price of the other three is 44860,000 yuan, 15320,000 yuan and 12850,000 yuan. "Frequent auctions and unsuccessful auctions" seem to have become a prominent feature of Zhongyuan Bank's stock and debt auctions.
Frequent large-scale equity auctions have an impact on the stability of Zhongyuan Bank's equity structure to a certain extent. As of June 30, 2023, Zhongyuan Bank had a total of 683.2 billion domestic shares were pledged, accounting for 18 percent of the total number of issued ordinary shares69%。There are 27 domestic shares involved in the judicial freeze6.4 billion shares, representing 756%。
In addition, according to the China Enforcement Information Disclosure Network, Henan Xingda Investment*** became an executor 17 times from March 10, 2021 to November 16, 2023;In addition, Zhengzhou Kangqiao Real Estate Development Co., Ltd., the seventh largest shareholder of Zhongyuan Bank, became an executor 40 times from March 9, 2023 to November 28, 2023, and 7 times from March 9, 2022 to June 19, 2023Henan Guangcai Group Development, the eighth largest shareholder, has become an executor 18 times from March 20, 2023 to November 29, 2023, and a dishonest person 4 times from January 5, 2023 to May 4, 2023.
The performance was unsatisfactory and the stock price was reduced to penny stocks
The equity has been auctioned repeatedly, and the performance of Zhongyuan Bank is also unsatisfactory. In the first half of 2023, Zhongyuan Bank achieved an operating income of 1355.1 billion yuan, a year-on-year increase of 3021%；Net profit 206.2 billion yuan, down 3 percent year-on-year60%；net profit attributable to shareholders of the bank was 200.2 billion yuan, down 4 percent year-on-year35%, there is a situation of increasing income but not increasing profits.
At the same time, the bank's internal control management cannot be ignored, according to incomplete statistics, since 2023, Zhongyuan Bank's branches have received 27 fines due to internal control management and financial violations, with a total fine of 5.28 million yuan.
Echoing this, Zhongyuan Bank's share price is sluggish and has become a "penny stock", and its market value has long been "broken". According to the latest data, as of December 27, Zhongyuan Bank's net assets per share were 231 yuan, but the stock price is only 0HK$335 shares, almost a fraction of the net assets per share, and the price-to-book ratio is as low as 016 times, the total market capitalization is only 1224.4 billion yuan.
How to break the "curse" of low stock prices and solve the problem of performance pressure may be the direction that Zhongyuan Bank needs to work hard in the future.
Reporter Luo Xuefeng, financial researcher Zhou Zizhang).