Recently, from the first “A+H” listed city commercial bank in the west, Bank of Chongqing Co., Ltd. (hereinafter referred to as the “Company”) has frequently received good news:
On March 18, Bank of Chongqing obtained an increase of 49,600 shares by Shanghai Stock Connect. The latest shareholding was 423,800 shares, accounting for 0.02% of the company’s total A shares. After Chongqing Bank’s A shares and H shares were included in the Shanghai-Hong Kong Stock Connect and Southbound Stock Connect lists, the market’s most direct “representation”. In addition, on March 11, the Shanghai Stock Exchange also announced that Chongqing Bank’s A shares will be included in the Shanghai Stock Connect Index, which will be adjusted from March 15.
Prior to March 11, the bank’s shareholder Lifan Technology (Group) Co., Ltd. (hereinafter referred to as Lifan Technology) held 12,964,932 shares of the company’s restricted tradable shares. The unfrozen shares accounted for 43.95% of its shares and 3.73% of the company’s total share capital. There were no remaining frozen shares.
At the same time, Tang Xiaodong, who represented Lifan (Lifan Industrial (Group) Co., Ltd., formerly known as Lifan Technology) as a non-executive director of Chongqing Bank, also resigned due to job adjustments.
Lifan Technology, as a major shareholder of Bank of Chongqing, has recently released positive news frequently. For Chongqing Bank’s stock price, it is expected to continue to be a market chasing outlet, and it is expected to further open up room for growth in the future. The fact that Shanghai Stock Connect increased its shareholding has confirmed this.
The road to new energy has opened, Lifan Technology has a promising future
Lifan Technology, the third largest shareholder of Bank of Chongqing, passed judicial reorganization and capital injection, and the original credits and debts were gradually sorted out. After the successful reorganization, Lifan Technology’s capital strength will increase and shareholders will be stronger. It is good for Chongqing Bank’s equity stability and asset quality.
Intrinsic value and external support are the two decisive factors for the success of the restructuring. From the perspective of intrinsic value, Lifan Technology has a relatively high core asset value in the automotive manufacturing industry, especially in new energy vehicle manufacturing. From the perspective of external support, the successful reorganization of Lifan Technology mainly relies on the strong support of the government, and it also confirms the good development prospects of the new energy market. Therefore, the success of Lifan Technology’s restructuring is within everyone’s expectations.
The reporter combed and found that the reorganization plan of Lifan Technology and ten subsidiaries had been implemented as early as early February. Lifan’s bankruptcy reorganization case was written into the Supreme People’s Court’s work report. The reorganization adopted the “financial investor + industrial investor” model. Liangjiang Fund and Geely Maijie participated in the reorganization in the form of a consortium. In addition, the Manjianghong Fund will inject 3 billion yuan of funds. This part of the funds will repay corporate debt, supplement the liquidity of listed companies, and provide support for subsequent industrial development. Among them, Manjianghong Fund was jointly initiated and established by Liangjiang Fund and Geely Maijie Company.
Through the reorganization process, Lifan Technology has realized the liquidation of corporate debts, the restoration of production and operation capabilities, and the protection of the interests of creditors and the harmony and stability of the society. At the same time, the success of Lifan’s reorganization has played a good demonstration effect for the orderly development of my country’s capital market.
After the completion of the reorganization, Lifan Technology will focus on the power exchange industry and actively prepare for new models. On February 2nd, Geely Technology Group’s first batch of smart swap stations in Chongqing’s expressway service area was simultaneously put into operation in the five service areas of Jingguan, Lihuashan, Weilong, Luohuang, and Dalu. This move means that Lifan Technology will Much can be done. According to the previously disclosed restructuring plan, Lifan Technology will rely on Geely Technology Group’s leading layout of intelligent network connection, power exchange technology, module upgrades, new technologies and new business formats for vehicle and electricity separation, and match Geely Technology Group’s national power exchange operation network and cities. The travel service market is expanding rapidly, relying on systematic competitiveness to increase market share and occupy the commanding heights of the industry.
At the same time, after the original director of Lifan shares resigns, it is expected that Lifan Technology will also be stationed as a new shareholder director. The strong shareholders of Lifan Technology after the flop will also benefit the investee-Bank of Chongqing.
Chongqing Bank has achieved high-quality and stable development over the years
The growth rate of revenue and net profit is “positive growth”, and the cost-to-income ratio is superior to the operating efficiency of its peers. Since its establishment in 1996, the Bank of Chongqing has made great progress. From the perspective of profitability, the growth rate of Bank of Chongqing’s operating income has been increasing year by year, and the growth rate of net profit has also shown “positive growth.” It is worth mentioning that while the profitability of Chongqing Bank has been increasing year by year, it has strictly controlled costs and expenditures, and has excellent operating efficiency and refined management. According to the official data of the Bank of Chongqing, from 2017 to 2019, the bank’s net profit was 3.764 billion yuan, 3.822 billion yuan, and 4.321 billion yuan; 2018-2019 year-on-year growth of 1.54% and 13.07% respectively. As of the third quarter of 2020, Bank of Chongqing’s operating income and net profit still performed “good”. In the third quarter of 2020, the operating income of Bank of Chongqing was 9.887 billion yuan, a year-on-year increase of 12.75%. During the same period, the net profit of Bank of Chongqing was 4.006 billion yuan, a year-on-year increase of 5.13%.
The capital is sufficient, the non-performing loan ratio has stabilized, and the overall loan risk is controllable. Chongqing Bank implements an active capital replenishment plan, focuses on internal accumulation, and continuously strengthens the business philosophy of capital constraints, and strengthens the control of the total risk-weighted assets. The core Tier 1 capital adequacy ratio, Tier 1 capital adequacy ratio and capital adequacy ratio of the Bank of Chongqing continue to maintain over-regulatory levels, with relatively sufficient capital. According to the prospectus, from 2017 to 2019, the core tier 1 capital adequacy ratio of Bank of Chongqing was 8.62%, 8.47%, and 8.51%, respectively. In the same period, the Tier 1 capital adequacy ratios of Bank of Chongqing were 10.24%, 9.94%, and 9.82%; the capital adequacy ratios were 13.6%, 13.21%, and 13%, respectively. At the same time, the non-performing loan ratio of Bank of Chongqing has been steadily declining, with relatively small fluctuations. From 2017 to 2019, the non-performing loan ratio of Bank of Chongqing was 1.35%, 1.36%, and 1.27% respectively, and the non-performing loan ratio was also lower than the industry average.
Shenwan Hongyuan Securities recently released a research report stating that Chongqing Bank is based in Sichuan and Chongqing and has great potential for development under the national regional strategy; there is still room for structural optimization, stabilizing the level of asset income, and reducing the cost of debt, helping the net interest margin to stabilize and rebound. ; The asset quality of regional construction projects is relatively good, non-performing generation is expected to remain low, and asset quality is expected to continue to improve.
In addition, the report pointed out that after the A-share listing in February 2021, Chongqing Bank’s capital strength has been greatly enhanced, and it is expected to follow the local government’s active investment of large-scale and high-quality projects to rapidly expand its list, which will become its future medium-term dimension release performance. Important foundation.
Reprint indicated source：Spark Global Limited information