[ET Net News Agency, 25 June 2018] Nomura upgraded Chongqing Rural Commercial Bank
(CQRC)(03618) to "neutral" from "reduce", but maintained its target price unchanged at
HK$5.34.
CQRC recorded a notable NPL uptick to 1.18% in 1Q, up 20bps q-q, closing the gap versus
long-term overdue ratio of 1.02% (FY2017). The research house sees the NPL recognition
issue largely fixed for CQRC, though Nomura still expects a rebound of NPL ratio to 2.1%
by end-FY2018 as overall NPL recognition speeds up.
That said, it expects credit cost to decline from 173bps in 1Q to 99bps in FY2018,
assuming a decline of NPL coverage to 200% by end-FY2018 versus 334% by 1Q, which was
already down 97pp q-q from 431% as of FY2017. (KL)
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03618 CQRC BANK
Nominal 
3.730 +0.040 (+1.084%) Others
25/06/2018 14:31
[I-bank focus]Nomura upgrades CQRC Bank (03618) to "neutral"
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