How to deal with old accounts?
1
dismal
Minsheng Bank (600016. SH) has another point of pressure on his shoulders.
According to the report for the first quarter of 2024, Minsheng Bank achieved operating income of 34.273 billion yuan, a year-on-year decrease of 6.8%. net profit attributable to shareholders of listed companies was 13.431 billion yuan, a year-on-year decrease of 5.63%.
What is the concept of this data? There is no harm if there is no comparison, among the 12 large-scale banks, Minsheng Bank's revenue growth rate ranks last, and the net profit growth rate is at the bottom.
▲ Source: Said Fortune Cat
In fact, the signs have already appeared. In 2023, Minsheng Bank will achieve operating income of 140.817 billion yuan, a year-on-year decrease of 1.16%. In the long run, from 2021 to 2023, the bank's operating income will decline for three consecutive years. In 2023, Minsheng Bank will achieve a net profit attributable to shareholders of the parent company of 35.823 billion yuan, a slight increase of 1.57% year-on-year.
Thinking back to more than ten years ago, Hong Qi, the third chairman of Minsheng Bank, bluntly said that "the bank is embarrassed to make money". Nowadays, it is difficult to maintain such a beautiful moment. The "golden rice bowl" of the bank is not as good as everyone imagined.
The trend is also reflected in the capital markets. As of the close of trading on May 14, 2024, Minsheng Bank (600016. SH) share price is 3.89 yuan per share, which has fallen 48% from the high, close to halving.
In terms of market capitalization, according to the data of Yiniu.com, the historical market value of Minsheng Bank was once as high as 391.4 billion, compared with today's 170.3 billion, which has evaporated by more than 220 billion.
According to public information, Minsheng Bank was established in Beijing on January 12, 1996, and is the first national joint-stock commercial bank in China established mainly by private enterprises. Today, it has total assets of more than 7.6 trillion yuan, net assets of more than 620 billion yuan, more than 2,600 branches and nearly 64,000 employees.
Why is the performance of such a bank so heartbroken?
2
High firewood
The answer can be found in the earnings report.
Let's start with interest rate spreads. According to the Changjiang Business Daily, from 2021 to 2023, the net income of Minsheng Bank's interest margin will be 125.775 billion yuan, 107.463 billion yuan, and 102.431 billion yuan respectively, a year-on-year decrease of 6.99%, 14.56%, and 4.68%.
In 2023, Minsheng Bank's net interest margin will be 1.46%, also declining for three consecutive years. According to data released by the National Financial Regulatory Bureau, the average net interest margin of commercial banks in 2023 is 1.69%. During the same period, Minsheng Bank's net interest margin was at the bottom of the 43 A-share banks.
At present, interest income is still the main source of income for commercial banks, and the narrowing of interest rate spreads is obviously not good news.
Let's look at the profit trend. From 2020 to 2022, the net profit of Minsheng Bank will be 34.309 billion yuan, 34.381 billion yuan, and 35.269 billion yuan respectively, with a year-on-year change of -36.25%, 0.21%, and 2.58%.
It can be seen that in 2020, Minsheng Bank's net profit plummeted. Behind this, Minsheng Bank made a credit impairment loss of up to 92.988 billion yuan that year, which greatly eroded profits. It can be said that since then, Minsheng Bank has been "healing".
It is worth mentioning that although the performance indicators of Minsheng Bank are declining, the salaries of senior executives are still "standing" at the head of the industry.
According to the data, in 2023, the total remuneration of directors, supervisors and senior executives of Minsheng Bank will be 46.817 million yuan, ranking first in the banking industry and far exceeding many peers.
From the perspective of the chairman's salary, in 2023, Gao Yingxin, chairman of Minsheng Bank, will receive a salary of 3.735 million yuan, which also ranks first among A-share listed banks.
▲ Source: Nandu Bay Finance Society
What's even more interesting is that this is the result of a salary cut. According to the statistics of Changjiang Business Daily, from 2010 to 2019, there were five years, and the salary of the chairman of Minsheng Bank exceeded 7 million yuan.
On one side, executives are paid high salaries, and on the other hand, there are frequent fines.
According to incomplete statistics from the media, from 2020 to 2022 alone, Minsheng Bank has received a total of more than 300 million yuan in fines. In 2023, Minsheng Bank will also receive three "sky-high fines". Among them, Minsheng Bank was fined 66.7 million yuan for 14 violations of laws and regulations, and its branches were fined 23 million yuan, with a total fine of 89.7 million yuan.
In the face of this situation, the executives of Minsheng Bank have to reflect on it.
3
encumber
The pressure on Minsheng Bank is not limited to this.
Previously, the "2022 Top 100 Chinese Banking Industries" released by the China Banking Association showed that Minsheng Bank ranked 11th, with a non-performing loan ratio of 1.79% -
This is the highest in the top 25.
Behind this, it is mainly the "credit" of real estate. According to public information, as of the end of 2022, the balance of non-performing loans of Minsheng Bank to the public real estate industry was 15.545 billion yuan, and the non-performing loan ratio was 4.28%. Citi issued a research report in 2021 that found Minsheng Bank's exposure to high-risk real estate developers to be about 130 billion yuan, accounting for 27% of Tier 1 capital, the highest proportion among large domestic banks.
According to the financial report, as of the end of 2023, the total non-performing loans of Minsheng Bank were 65.097 billion yuan, a decrease of 4.290 billion yuan from the end of the previous year, and the non-performing loan ratio was 1.48%, a decrease of 0.20 percentage points from the end of the previous year, a slight improvement.
However, in 2023, the total non-performing loans of Minsheng Bank's real estate industry will be 17.038 billion yuan, an increase of 1.493 billion yuan year-on-year, and the non-performing rate will be 4.92%, an increase of 0.64 percentage points from 2022.
Real estate is still the dark mine of Minsheng Bank. According to the data compiled by Blueberry Finance, from 2018 to 2019, Minsheng Bank signed strategic cooperation agreements with at least 18 real estate companies, including Zhenro, Sunshine City, Jinke, Kaisa, Blu-ray, etc. In addition, Minsheng Bank also provided a large number of loans to Oceanwide Holdings and Evergrande, and the two companies together exceeded 50 billion.
▲The main correspondent banks listed in Evergrande's announcement
With the arrival of the thunderstorm of real estate enterprises, these bitter fruits can only be slowly digested by Minsheng Bank itself.
Speaking of which, Minsheng Bank will be burdened by real estate, and it is inseparable from the help of shareholders.
When it was formally established that year, Minsheng Bank had 59 founding shareholders, and its shareholding was extremely diversified. New Hope Group, Oceanwide Group and Oriental Group are all important shareholders of Minsheng. Due to its dispersed shareholding and lack of actual controlling shareholders, Minsheng Bank is very prone to related-party transactions – issuing sky-high loans to shareholders or lending to other enterprises as guarantees from shareholders.
The most obvious example is Oceanwide Group, a story once circulated among the investor group of Minsheng Bank, which tells that a minority shareholder bought shares through high leverage and became the largest shareholder, and then approved tens of billions of loans to himself, not only repaying the highly leveraged loans, but also injecting tens of billions of yuan into his own company.
In the eyes of the outside world, this "minority shareholder" is Oceanwide Group. Today, Lu Zhiqiang's Oceanwide system is crumbling, and Minsheng Bank and its major shareholders have long torn their faces.
According to the combing of market capitalization, the amount of related party loans of Minsheng Bank will reach 63.7 billion yuan in 2021, and Minsheng Bank was once considered the "cash machine" of major shareholders.
Objectively speaking, as "China's first private bank", Minsheng Bank has created many feats and made some innovations, such as business unit reform, such as small and micro finance strategy. But nearly 30 years have passed, does this "dark horse" of the banking industry still have momentum? Do you remember your original intention?
Luckily, it's not too late, as the old saying goes—
The best time to plant a tree was ten years ago, followed by now.