[ET Net News Agency, 9 February 2018] HSBC Global Research lifted its target price for
China Minsheng Banking (01988) to HK$9.3 from HK$8.4, and maintained its "hold" rating.
The research house cut its 2017 and 2018 earnings forecast by 1% and 4%, respectively,
mainly on the lower net interest income and lower fee income, despite the lower
provisioning.
It said that Minsheng, the only joint stock bank founded by private enterprise, was
known for innovation and its commitment to serving SMEs. However, profitability faded as
the quality of SME assets deteriorated.
The bank now has a more balanced strategy, servicing enterprises of all sizes,
individuals, and peer financial institutions. It also has ambitions in internet finance
and integrated finance. Although this strategy should enhance stability, ROE may remain
under pressure. (KL)