An old bank has entered a "painful period".
1
The "pain" of stock prices
000001 report card came as early as in previous years.
This string of numbers is the code of Ping An Bank. On March 15, Ping An Bank announced its 2023 annual report. Among the A-share listed banks, this is also the first to publish annual reports.
This earnings report has a lot of people excited. In its annual report, Ping An Bank disclosed the most "generous" dividend plan in history:
It is proposed to distribute a cash dividend of RMB 7.19 (tax included) for every 10 shares, with a total cash dividend of RMB 13.953 billion, and a dividend rate of 32% (dividend amount/net profit).
This dividend rate significantly exceeds the level of 10% to 15% in previous years.
Although the dividend of 10 billion yuan is eye-catching, it still cannot hide the loneliness in the performance of Ping An Bank.
In 2023, Ping An Bank will achieve operating income of 164.699 billion yuan, a year-on-year decrease of 8.4%. In the same period, the net profit was 46.455 billion yuan, a year-on-year increase of 2.1%.
The decline in revenue is obvious, and behind the slight increase in net profit, it also involves factors such as the reduction of credit impairment losses. Excluding these factors, the net profit figure is also hardly excellent.
The signs are already there. In the first quarter of 2023, Ping An Bank will have the phenomenon of "increasing profits but not increasing revenue", with an operating income of 45.098 billion yuan, a year-on-year decrease of 2.4%. The net profit growth rate also decreased to 13.6% from 26.83% in the same period of 2022.
In the long run, Ping An Bank's revenue growth has been slowing down in the past five years, and it will directly decline in 2023.
From the perspective of the capital market, as of the close of trading on March 25, 2024, the share price of Ping An Bank is 10.4 yuan per share. This figure has fallen by 57% from the high point in 2021, which has been cut in half.
Looking at the market value again, Yiniu data shows that the historical market value of Ping An Bank once exceeded 480 billion, and now only 201.8 billion remains, evaporating more than 280 billion.
According to public information, Ping An Bank, formerly known as Shenzhen Development Bank Co., Ltd., was established in 1987. As early as 1991, the bank was listed on the Shenzhen Stock Exchange, and it was also the first commercial bank in China to go public. At the end of 2023, Ping An Bank's total assets were 5,587.116 billion yuan and total liabilities were 5,114.788 billion yuan, which is not small.
What has such an old bank experienced?
2
The "pain" of retail
The answer is also hidden in the financial report.
In the face of the stall of performance, the reason given by Ping An Bank in the annual report is that it is affected by factors such as continuous concessions to the real economy, adjustment of asset structure and market fluctuations.
This explanation alone may be difficult to understand. Looking at the specific data, in 2023, Ping An Bank's retail finance business will contribute 96.161 billion yuan of operating income (accounting for 58.4%), a year-on-year decrease of 6.65%, and retail finance business will contribute 5.525 billion yuan of net profit, a year-on-year decrease of 72.14%.
In addition, as of the end of 2023, the balance of Ping An Bank's retail financial business was 1,948.994 billion yuan, a decrease of 78.022 billion yuan from 2,027.005 billion yuan at the end of the previous year.
Behind this is Ping An Bank's adjustment of the personal loan structure, and the bank has taken the initiative to control high-yield and high-risk businesses. Generally speaking, the balance and proportion of mortgage loans and mortgage operating loans increased, while the balance and proportion of credit card and consumer loans decreased.
Compared with the previous year, the balance of consumer loans of Ping An Bank will drop by 56.956 billion yuan in 2023, and the balance of credit card accounts receivable will drop by 64.599 billion yuan.
A typical manifestation is the credit card business. According to the data, since switching to retail in 2016, Ping An Bank's credit card business has achieved substantial growth. In 2018, the number of credit cards in circulation exceeded 50 million, and in 2021, it exceeded 70 million. In 2022, Ping An Bank issued 2,070,100 new cards, which will become 1,375,400 in 2023, a decrease of 694,700 in one year.
In addition, the bank's total credit card spending in 2023 will be 2,781.504 billion, a direct decrease of 18% compared with 3,391.911 billion in 2022.
This approach is reflected in the performance, in 2023, the average yield on loans and advances issued by Ping An Bank will be 5.43%, down 47 basis points year-on-year. The average yield on personal loans was 6.58%, down 80 basis points year-on-year.
Previously, due to the rapid development of retail business, the outside world called Ping An Bank the "new king of retail". But now, whether it is the number of customers, revenue volume or growth rate, Ping An Bank is still far from China Merchants Bank.
3
The "pain" of compliance
Although Ping An Bank's credit card business is slowing down, the after-effects of past expansion are still being revealed.
Searching for "Ping An Bank" on the Black Cat complaint platform, there are as many as 22,246 related complaints, and there are not a few related to credit card business.
As early as 2021, the Consumer Protection Bureau of the China Banking and Insurance Regulatory Commission (CBIRC) issued a notice showing that Ping An Bank's telemarketing of physical products in cooperation with a third party infringed on the legitimate rights and interests of consumers. At that time, the number of consumer reports received by the regulator on the telemarketing of Ping An Credit Card Center increased significantly, and after random inspections of the bank's 60 businesses, 53 of which had violations of laws and regulations, accounting for 88.33%.
The trouble doesn't just come from the credit card business. According to the "Circular on Consumer Complaints in the Banking Industry in the First Quarter of 2023" issued by the State Administration of Financial Supervision and Administration, a total of 104909 consumer complaints in the banking industry were received and forwarded by the regulatory authorities in the current period, of which 29,041 were involving joint-stock commercial banks, accounting for 27.7% of the total number of complaints.
Among the complaints of joint-stock commercial banks, Ping An Bank has 4,649 complaints, accounting for 16% of the total complaints of joint-stock commercial banks, ranking first.
Judging from the data, the number of complaints is 2.2 times that of China Merchants Bank and 12 times that of Hengfeng Bank.
In addition to complaints, there are also tickets. For example, in July 2023, the People's Bank of China (PBoC) published a batch of administrative penalty information on its website, of which 32 fines involved three financial institutions. Among them, Ping An Bank received the largest fine, fined 34.925 million yuan, and 12 relevant responsible persons were also fined a total of 913,000 yuan.
According to the information disclosed by the regulator, Ping An Bank's illegal acts include violating the regulations on account management, violating the regulations on the management of anti-counterfeit currency business, occupying financial deposits or funds, and failing to fulfill customer identification obligations as required.
Since the beginning of 2024, a number of branches and subordinate centers of Ping An Bank have been subject to regulatory penalties.
For example, on January 5, the People's Bank of China disclosed information showing that the Changzhou branch of Ping An Bank was fined 750,000 yuan for failing to fulfill its customer identification obligations as required. On the same day, the Fuzhou branch of Ping An Bank was fined a total of 2.7 million yuan for problems such as inadequate internal control and management of real estate development loans.
On January 10, Ping An Bank's capital operation center was fined a total of 1.8 million yuan due to unreasonable assessment and incentive settings for hedging business.
The frequent fines have exposed Ping An Bank's risk control and compliance problems.
4
End
Finally, the "pain" of change.
Back in June 2023, Ping An Bank issued an announcement saying that the board of directors deliberated and approved the appointment of Ji Guangheng as the president of Ping An Bank. A few months later, the State Administration of Financial Supervision and Administration approved the qualifications of the president and director of Jiguangheng Ping An Bank.
Ji Guangheng is a veteran of the banking industry, and he also made quick moves after taking office. Intuitively, it is an adjustment of the organizational structure. In the retail sector, Ping An Bank abolished the retail business management departments in the three regions of the Eastern, North and Southern Regions, and in the corporate finance sector, it eliminated the original six industry business divisions. From the perspective of department setting, the head office of Ping An Bank has streamlined the number of departments from the previous 43 to 32.
In addition, Ping An Bank's business strategy has also been adjusted from "leading by technology, making breakthroughs in retail, and doing fine in the corporate" to "strengthening in retail, refining in corporate, and specializing in the industry".
At the same time, there have been more rumors about Ping An Bank's layoffs. At the beginning of the year, there were even rumors on social media that "Ping An Bank continued to lay off 40% of its staff after laying off 30% of its staff at the beginning of last year", which caused heated discussions. Although the matter has been refuted by Ping An Bank, the relevant news still comes and goes.
Ji Guangheng's heart of change is urgent, but the sequelae of performance stalling and transformation pains are accelerating. This veteran must be under a lot of pressure.
Whether this change is a stroke of genius or a desperate move can only be answered by time.