China Merchants Bank Co., Ltd., Q3 2024 Earnings Call, Nov 01, 2024 - SEHK:3968

SEHK:3968

Xia Yangfang, General Manager of the Office of the Board of Directors, welcomed participants to the 2024 Third Quarter Results Conference of China Merchants Bank (CMB). She introduced the participants, including executives and independent non-executive directors, and outlined the agenda for the meeting, which consists of a presentation by Mr. Peng Jiawen on financial highlights and operational performance, followed by a Q&A session. Xia Yangfang thanked attendees for their interest and support in CMB.

**- Financial Highlights: Net operating income for the first 3 quarters was CNY 252.6 billion, down 2.93% year-on-year. Net profit attributable to the bank's shareholder was CNY 113.184 billion, down 0.62% year-on-year. ROAA and ROAE were 1.33% and 15.38%, respectively.

• Capital Levels: Core CET1 CAR was 14.73%, Tier 1 CAR was 16.99%, and CAR was 18.67%, all showing increases compared to the end of last year.

• Cost Management: Operating expenses were CNY 82.172 billion, with a cost-to-income ratio of 29.59%, down 0.5 percentage points year-on-year.

• Asset and Liability Management: Total assets were CNY 11.65 trillion, up 5.68%. Total loans and advances were CNY 6.76 trillion, up 3.84%. Total liabilities were CNY 10.5 trillion, up 5.56%. Total customer deposits were CNY 8.73 trillion, up 7.08%.

• Net Interest Income (NII) and Net Interest Margin (NIM): NII was CNY 157.3 billion, with a decline narrowed by 1.1 percentage points. NIM was 1.99%, down 20 bps year-on-year.

• Wealth Management: Retail AUM was CNY 14.34 trillion, up CNY 1.02 trillion year-on-year. Fee and commission income was CNY 55.7 billion, down 16.9%. Wealth management fee and commission income was CNY 17.4 billion, down 27%.

• Asset Quality: NPL ratio was 0.94%, special-mentioned loan ratio was 1.3%, and overdue loan ratio was 1.36%. New NPL formation was CNY 48.2 billion, up CNY 2.71 billion year-on-year. Allowance coverage ratio was 432.15%, and loan provision ratio was 4.06%.

• Future Outlook: Policies launched after September 24th are expected to positively impact the capital market, consumption, and risk mitigation. Challenges include volatility in deposit ratios, NIM pressure, and debt market volatility. CMB will focus on expanding wealth management, seizing investment opportunities, and improving asset and liability management.**