Under the "multi-faceted flowering", China CITIC Bank is not satisfactory in terms of compliance.
In the 2024 A-share crisis, the "Zhongzitou" and the banking sector are on the offensive, leading the team to charge against the trend, aiming to escort the index, although the current A-share market is still in a weak market and strong **.
China CITIC Bank, one of the defenders of the capital market, shares from 5The bottom point of the stock rose to 6 recently$52 shares. However, from a fundamental point of view, the bank fell into the embarrassment of increasing profits but not increasing revenue last year. Not only that, the senior executives of China CITIC Bank's branches were revoked by the regulator because their academic qualifications did not meet the requirements.
Interest margins narrowed and net profit growth slowed
A-shares are proud, business is frustrated.
According to the 2023 performance report, China CITIC Bank achieved an operating income of 20589.6 billion yuan, down 2 from the same period last year6%；Net profit attributable to shareholders of the Bank was 6701.6 billion yuan, a year-on-year increase of 791%。
As for the "one drop and one increase", China CITIC Bank did not give a specific explanation. And in fact, this sign has been foreshadowed for a long time, 2023.
In the first, second and third quarters, the bank's operating income decreased year-on-year respectively. 62%, net profit compared with the same period last year**19%。
Behind the gap, the sluggish growth of China CITIC Bank's operating income was mainly due to the narrowing of interest margins, net interest income in the first three quarters was 10923.9 billion yuan, down 1 from the same period last year9% and net interest margin 182%, down 014 percentage points. In comparison, in 2022, China CITIC Bank recorded a net interest income of 1,506500 million yuan, an increase of 1 year-on-year9%。
At the third quarter 2023 results briefing, Xue Fengqing, general manager of the financial and accounting department of China CITIC Bank, said that the decline in net interest margin was mainly due to the impact of the decline in interest rates, the continued pressure on asset yields, and the relatively rigid cost of deposits. "There are still many unfavorable factors affecting the net interest margin in the fourth quarter of this year, mainly due to the adjustment of mortgage interest rates and the reduction of LPR interest rates.
Stretching the timeline, in the ten years from 2014 to 2023, China CITIC Bank only experienced a year-on-year decline in operating income in 2023. And from the perspective of net profit growth, 2021 and 2022 will increase respectively compared with the same period of the previous year. 61%, compared to 791%, the growth rate tends to slow down.
In addition,As of the end of 2023, China CITIC Bank's non-performing loan ratio was 118%, down 009 percentage points; The provision coverage ratio is 20759%, up 64 percentage points. It is worth mentioning that at the end of 2020, the non-performing loan ratio of China CITIC Bank reached 164%, with a provision coverage ratio of only 17168%。In other words, asset quality has improved.
Three-in-one! Make up for the shortcomings of the retail business
2023 is the fourth full fiscal year for Fang Heying, then president and current chairman, to visit China CITIC Bank. Over the past four years, China CITIC Bank has successfully coped with the challenges brought about by the three-year epidemic and turned its retail finance business into a new engine for development.
At the 2021 annual report press conference, China CITIC Bank systematically elaborated its new retail panorama for the first time, saying that it is building a value chain of "wealth management-asset management-comprehensive financing" with wealth management as the main body, and at the same time formulating a new approach to retail business 12345, including:
Integration - with wealth management as the main body.
Two wings - digitalization and ecology.
Three-full - all customers, all products, all channels adaptation.
Four Rings - Plate Integration, Bank-wide Linkage, Group Synergy, and External Connection.
Five main - main settlement, main investment, main financing, main activities, main services.
As of the end of the third quarter of last year, the total number of personal customers of China CITIC Bank was 13.4 billion households, an increase of 703 from the end of the previous year840,000 households; Personal loan and credit card balances increased by 1,278 respectively9.8 billion yuan and 12.3 billion yuan; The balance of personal deposits increased by 15994.1 billion yuan.
At the end of the same period, the total number of corporate customers was 112620,000 households, an increase of 8 from the end of the previous year890,000 households; The balance of general corporate loans is 249 trillion yuan, an increase of 18656.4 billion yuan, an increase of 811%；The scale of public wealth 19491.7 billion yuan.
Behind these data, it reflects the strategic thinking of "three drives together" advocated by China CITIC Bank, that is, the three major business segments of corporate, retail and financial markets complement each other and support each other, and form a comprehensive financial service capability for customers in the whole chain through the comprehensive linkage of lines, businesses, customers, products and internal and external resources.
However, under the "multi-faceted flowering", China CITIC Bank is not satisfactory in terms of compliance.
Risks that go hand in hand with development: Frequent and large fines
On January 22 this year, the Xinjiang Supervision Bureau of the State Administration of Financial Supervision and Administration made public a "Decision on the Revocation of Administrative Licensing Items", and the object of the revocation was China CITIC Bank.
Specifically, on September 13, 2023, the Xinjiang Supervision Bureau of the State Administration of Financial Supervision and Administration approved Cheng Wei's application to be the assistant to the president of the Urumqi branch.
However, after investigation and verification, Cheng Wei did not meet the requirements of Article 87, Paragraph 3 of the Implementation Measures of the China Banking and Insurance Regulatory Commission for Administrative Licensing Items of Chinese-funded Commercial Banks, which stipulates that the assistant to the president of a branch of a joint-stock commercial bank should have a bachelor's degree or above.
In accordance with the relevant provisions of the Administrative Licensing Law, the Xinjiang Supervision Bureau of the State Administration of Financial Supervision and Administration decided to revoke the reply on Cheng Wei's qualifications. In fact, the approval of such qualifications is rareThe purpose of the core of regulation is to ensure that "the right person is in the right place". From another point of view, there are loopholes in the management of employment in China CITIC Bank.
In terms of business, since 2024, China CITIC Bank has received a number of fines, of which three are at the million-level level
On January 26, the Nantong Supervision Branch of the State Administration of Financial Supervision and Administration announced the administrative penalty information disclosure form, due to the inflated scale of inclusive small and micro enterprise loans; Failure to perform due diligence in credit management; Illegal issuance of second-hand housing mortgage loans; China CITIC Bank Nantong Branch was fined 1.3 million yuan for failing to perform due diligence in the management of bills and letters of credit. **Hui, assistant to the president of the Nantong branch, was responsible for inflating the scale of inclusive small and micro enterprise loans and failing to perform his duties in credit management, and was given a warning and fined 80,000 yuan.
On January 5, the State Administration of Financial Supervision and Administration Administrative Penalty Information Disclosure Form showed that China CITIC Bank received a fine of 4 million yuan, and the main illegal facts includedSome important information systems should be deemed to have not been identified, and the relevant systems have not built disaster recovery or disaster recovery capabilities that do not meet regulatory requirements; There have been long-term infrastructure risks and hidden dangers in the same-city data center, which have not been rectified; The pre-entry due diligence and daily management of the outsourced data center did not meet the regulatory requirements, and some data centers had hidden risks, and the data center computer room drill was a mere formality. Some of the drills were false drills and were not actually carried out; Failure to report major changes to the data center to the regulatory authorities; Operational disruption event reporting does not meet regulatory requirements.
In addition, according to the administrative penalty information released by the Yancheng Supervision Branch of the State Administration of Financial Supervision and Administration on January 4, the Yancheng Branch of China CITIC Bank had misappropriated loan funds and partially transferred to the bank's margin deposits; Margin of bill business** is used for credit funds and discount funds; The investigation, review and monitoring of project capital are not in place; The sales of wealth management and trust products were not standardized, and he was fined 1.6 million yuan. The person in charge was given a warning and fined.
Even on December 1 last year, the State Administration of Financial Supervision and Administration announced 56 violations of laws and regulations of China CITIC Bank, involving violations of relevant regulations on the management of access to senior executives; non-compliance in the management of related party loans; The performance appraisal does not comply with the regulations; insufficient disclosure of material related party transaction information, etc. As a result, the bank was fined a total of 22.5 billion yuan. Those responsible were fined and warned to varying degrees.