[ET Net News Agency, 9 October 2017] Nomura cut its target price for Chongqing Rural
Commercial Bank (CQRC)(03618) to HK$4.6 from HK$5.02, and maintained its "reduce" rating.
Despite posting the lowest LDR of 57% in 1H and having the strongest deposit-taking
franchise, CQRC still saw its funding cost rise by 10bps from FY2016 to 1H 2017 while its
asset yield fell by 5bps in the same period - leading to a 15bps decline in NIM from
FY2016 to 2.59% in 1H, said the research house.
Nomura calculated that CQRC's 2Q NIM further declined 14bps q-q to 2.52%, lagging the
+7bps expansion of the big four banks, and also lagged the mid-cap average of -8bps.
Nomura's FY2017 NIM forecast is 2.60%, +1bp from 1H level, as it sees the NIM improving
as loan yield catches up, but the research house doesn't see further NIM expansion either.
(KL)
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03618 CQRC BANK
Nominal 
3.350 +0.020 (+0.601%) Others
09/10/2017 10:38
[I-bank focus]Nomura cuts CQRC Bank (03618) to HK$4.6
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