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Bank of Nanjing Co., Ltd. (601009) Report Analysis

Corporate Events

Positive

Bank of Nanjing Co., Ltd., 0.46162 (CNY), Cash ...

2022-04-18 00:00:00

Bank of Nanjing Co., Ltd., 0.46162 (CNY), Cash Dividend, Jun-17-2022

Neutral

Bank of Nanjing Co., Ltd. Presents at 12th Annu...

2021-10-29 18:11:00

Bank of Nanjing Co., Ltd. Presents at 12th Annual China Investment Conference, Nov-01-2021 . Venue: Shenzhen, China.

Positive

Bank of Nanjing Co., Ltd., 0.46162 (CNY), Cash Dividend, Jun-17-2022

2022-04-18 00:00:00

Bank of Nanjing Co., Ltd., 0.46162 (CNY), Cash Dividend, Jun-17-2022

Neutral

Bank of Nanjing Co., Ltd. Presents at 12th Annual China Investment Conference, Nov-01-2021

2021-10-29 18:11:00

Bank of Nanjing Co., Ltd. Presents at 12th Annual China Investment Conference, Nov-01-2021 . Venue: Shenzhen, China.

Fundamental Summary

When Bank of Nanjing released their Q1 data on 2022-04-15, many of their key metrics appeared underwhelming. its growth and income factors look concerning individually, but the holistic financial picture was more impressive. In statistics, this is called the Simpson Paradox (https://www.britannica.com/topic/Simpsons-paradox). We give Bank of Nanjing a 74 rating and a HOLD recommendation.

Bank of Nanjing reported earnings results for the first quarter ended March 30, 2022. For the first quarter, the company reported net interest income was CNY 6,898.25 million compared to CNY 6,960.6 million a year ago. Net income was CNY 5,014.59 million compared to CNY 4,099.21 million a year ago. Basic earnings per share from continuing operations was CNY 0.5 compared to CNY 0.41 a year ago. Diluted earnings per share from continuing operations was CNY 0.43 compared to CNY 0.41 a year ago.

Business Description

Bank of Nanjing provides various financial products and services to micro or small enterprises, medium or large corporates, and employees in China. The company offers RMB or foreign currency deposits, including demand deposits, term deposits, call deposits, and contract deposits in RMB; basic, ordinary, temporary, and special purpose RMB deposit accounts; and current and capital foreign exchange accounts. It also provides working capital loans, project loans, inventory loans, bill discounting services, project loan bill acceptance services, and trade financing services, as well as mortgage loans; LC credit limit, import LC, shipping guarantee, and trust receipt loans for importers; and financing on the order, export LC financing, package loan, discounted commercial invoice, forfeiting, and financing on export insurance services for exporters. In addition, the company offers salary card, salary payment, wealth management, credit card, consumer finance, online corporate banking, corporate card, and risk hedging services; and cash management services, including account, collection and payment, investment and financing, liquidity, and risk management. Further, it provides trade services, such as international remittance, RMB cross-border settlement, letter of credit, international collection, letter of guarantee and SBLCs, foreign exchange spot and forward, and trade specialist contact. The company operates through a network of 136 branches. Bank of Nanjing was founded in 1996 and is based in Nanjing, China.

Sector Overview

Bank of Nanjing is included in the Banks according to GICS (global industry classification standard). The Banks industry, which is in the Financials sector, includes Diversified & Regional Banks whose operations focus on conventional banking, retail banking, and lending to SMEs (small and medium enterprises). Bank of Nanjing's industry and sector affiliation are expected to negatively affect their likelihood to overperform the market in the upcoming period, as other sectors appear more likely to benefit from the macroeconomic environment we see now.

Fundamental Highlights


Parameter Value Change Score
Assets 1,882,609.5 10.1% 51
Liabilities 1,755,174.7 10.2% 81
Price to Book 0.9 6.5% 82
Cash & Equivalents 43,794.4 107.8% 89
Equity 116,361.8 9.9% 51
Total Revenues 32,717.0 11.3% 48
Parameter Value Change Score
Return on Equity 14.1 1.0% 74
Net Cashflow 14,280.1 4752.0% 49
Capital Expenditure -1,825.6 -26.4% 48
Free Cashflow 5.9 -43.5% 84

* All values are TTM

The below chart reflects Bank of Nanjing's birds-eye view on its performance with respect to its peers, the company's fillings as reported or to a similar industry, market cap, and country of origin. While Bank of Nanjing's peer average final assessment score stands on 74.0, Bank of Nanjing's score is 74.

  •  601009
  •  Peers average
Name Market Cap Balance Sheet Income Statement Cash Flow Rating Final Assessment mc_sort Hidden
China Merchants Bank Co., Ltd. 1.1T 77 63 68
Hold
73
73 0 1
Industrial Bank Co., Ltd. 402.2B 85 67 66
Buy
80
80 1 1
Shanghai Pudong Development Bank Co., Ltd. 233.9B 72 61 68
Hold
68
68 2 1
China Everbright Bank Company Limited 160.4B 76 63 56
Hold
70
70 3 1
China Minsheng Banking Corp., Ltd. 150.8B 81 62 79
Hold
78
78 4 1
Bank of Jiangsu Co., Ltd. 100.3B 83 71 84
Buy
86
86 5 1
Bank of Beijing Co., Ltd. 95.8B 84 59 75
Hold
77
77 6 1
Bank of Shanghai Co., Ltd. 92.8B 90 64 81
Buy
85
85 7 1
Bank of Hangzhou Co., Ltd. 85.0B 81 70 69
Buy
80
80 8 1
Hua Xia Bank Co., Limited 79.1B 81 63 75
Hold
77
77 9 1
Bank of Chengdu Co., Ltd. 61.3B 86 68 58
Buy
79
79 10 1
Bank of Changsha Co., Ltd. 31.4B 79 62 60
Hold
72
72 11 1
QILU BANK CO., LTD. 22.4B 93 69 80
Strong Buy
91
91 12 1
Bank of Guiyang Co.,Ltd. 21.2B 80 62 75
Hold
77
77 13 1
Jiangsu Changshu Rural Commercial Bank Co., Ltd. 20.6B 82 71 80
Buy
84
84 14 1
Bank of Xi'an Co.,Ltd. 16.2B 80 56 51
Hold
70
70 15 1
Xiamen Bank Co., Ltd. 15.6B 83 62 82
Buy
80
80 16 1
Zhejiang Shaoxing RuiFeng Rural Commercial Bank Co.,Ltd 12.2B 83 70 69
Buy
81
81 17 1
Jiangsu Zijin Rural Commercial Bank Co.,Ltd 10.5B 77 60 53
Hold
70
70 18 1
Wuxi Rural Commercial Bank Co.,Ltd 10.3B 73 64 79
Hold
73
73 19 1
Jiangsu Suzhou Rural Commercial Bank Co., Ltd 9.0B 74 73 70
Hold
76
76 20 1
Ping An Bank Co., Ltd. 281.2B 83 72 85
Strong Buy
87
87 21 1
Bank of Ningbo Co., Ltd. 225.7B 89 70 71
Buy
86
86 22 1
Bank of Suzhou Co., Ltd. 22.1B 92 60 61
Buy
80
80 23 1
Qingdao Rural Commercial Bank Co., Ltd. 18.4B 74 61 81
Hold
73
73 24 1
Jiangsu Zhangjiagang Rural Commercial Bank Co., Ltd 11.1B 77 71 64
Hold
76
76 25 1
Jiangsu Jiangyin Rural Commercial Bank Co.,LTD. 9.3B 77 70 53
Hold
72
72 26 1

Technical Analysis

When trying to optimize the timing of an investment, it's critical to analyze whether the stock looks overbought or oversold, and in which direction the momentum is moving. Bank of Nanjing's stock is now priced above its 5-day and 200-day, but below its 50-day moving average, while its MACD (moving average convergence divergence) indicates that the stock's price movement momentum is weakening. Historically, this is a positive setup in the near and long-term. In particular, many institutional investors keep close watch of the 200-day moving average. Meanwhile, looking at the Stochastic Oscillator and RSI (relative strength index), Bank of Nanjing's stock indicates that it's likely oversold. Overall, these technical indicators don't clearly signal directional momentum. Therefore, this stock received a cumulative TA (technical analysis) score of 62.

Neutral 62
Close Price 10.93
52W Low 8.5
52W High 12.2
5D MA 10.7
50D MA 11.24
200D MA 10.09
MACD -0.12
RSI 0.72
STOCH 36.7

Balance Sheet Analysis

Overall, Bank of Nanjing's critical balance sheet metrics appear to signal strong support and a high likelihood of positive growth going forward. Bank of Nanjing did a great job related to cash and cash equivalents this period, which stood at 43794.4, representing a 107.8% change from the previous filing. This performance is significantly more impressive than its peers and competitors. It suggests that their stock price has room to grow to reflect its actual intrinsic value. Therefore, its cash and cash equivalents movement earned a score of 89. Also, Bank of Nanjing publishes solid book value factor metrics in this report. Price to book ratio (P/B) now sits at 0.9 and represents a 6.5% change from the previous report. Their industry-leading book value factors momentum reinforces an expectation for future positive momentum for their stock price going forward. The company's book value factors component, therefore, received a grade of 82. That said, one metric, Assets, stood out as particularly concerning. Mediocre performance in terms of assets could drop the bar on expectations for Bank of Nanjing's future attractiveness, as they changed to 1882609.5 in the latest filing. This works out to a 10.1% change from the last period. This unimpressive metric is weaker than its peers and competitors. Consequently, their asset movement received a grade of 51. Therefore, its balance sheet earned a grade of 82.

Parameter Value Change Score
Assets 1,882,609.5 10.1% 51
Liabilities 1,755,174.7 10.2% 81
Price to Book 0.9 6.5% 82
Cash & Equivalents 43,794.4 107.8% 89
Equity 116,361.8 9.9% 51
* All values are TTM

The below chart describes Bank of Nanjing's performance as reflected on its balance sheet with respect to its peers. While Bank of Nanjing received a balance sheet score of 82, the average of its peers stands on 77.0.

  •  601009
  •  Peers average
Name Market Cap Liabilities Movement Asset Change Equity/Intangibles Adjustments Cash & Equivalents Book Value Momentum Balance Sheet mc_sort Hidden
China Merchants Bank Co., Ltd. 1.1T 72 81 68 37 84 77 0 1
Industrial Bank Co., Ltd. 402.2B 74 80 68 90 82 85 1 1
Shanghai Pudong Development Bank Co., Ltd. 233.9B 74 70 55 51 76 72 2 1
China Everbright Bank Company Limited 160.4B 89 44 69 54 76 76 3 1
China Minsheng Banking Corp., Ltd. 150.8B 80 45 69 90 77 81 4 1
Bank of Jiangsu Co., Ltd. 100.3B 87 85 55 92 78 83 5 1
Bank of Beijing Co., Ltd. 95.8B 64 63 68 67 90 84 6 1
Bank of Shanghai Co., Ltd. 92.8B 83 62 54 90 90 90 7 1
Bank of Hangzhou Co., Ltd. 85.0B 82 63 54 87 79 81 8 1
Hua Xia Bank Co., Limited 79.1B 79 49 69 89 76 81 9 1
Bank of Chengdu Co., Ltd. 61.3B 83 76 68 82 83 86 10 1
Bank of Changsha Co., Ltd. 31.4B 74 63 69 72 79 79 11 1
QILU BANK CO., LTD. 22.4B 80 59 95 77 89 93 12 1
Bank of Guiyang Co.,Ltd. 21.2B 74 61 69 77 80 80 13 1
Jiangsu Changshu Rural Commercial Bank Co., Ltd. 20.6B 85 81 69 60 81 82 14 1
Bank of Xi'an Co.,Ltd. 16.2B 81 55 67 97 75 80 15 1
Xiamen Bank Co., Ltd. 15.6B 86 66 69 84 78 83 16 1
Zhejiang Shaoxing RuiFeng Rural Commercial Bank Co.,Ltd 12.2B 83 72 69 81 79 83 17 1
Jiangsu Zijin Rural Commercial Bank Co.,Ltd 10.5B 41 80 56 95 80 77 18 1
Wuxi Rural Commercial Bank Co.,Ltd 10.3B 66 72 55 62 78 73 19 1
Jiangsu Suzhou Rural Commercial Bank Co., Ltd 9.0B 78 77 55 60 75 74 20 1
Ping An Bank Co., Ltd. 281.2B 79 78 69 88 79 83 21 1
Bank of Ningbo Co., Ltd. 225.7B 86 51 68 97 84 89 22 1
Bank of Suzhou Co., Ltd. 22.1B 91 82 54 97 89 92 23 1
Qingdao Rural Commercial Bank Co., Ltd. 18.4B 66 68 55 72 77 74 24 1
Jiangsu Zhangjiagang Rural Commercial Bank Co., Ltd 11.1B 84 53 55 65 79 77 25 1
Jiangsu Jiangyin Rural Commercial Bank Co.,LTD. 9.3B 76 66 69 76 74 77 26 1

Income Statement Analysis

Bank of Nanjing appears likely to maintain its strong income statement metrics, especially Return Factors. Bank of Nanjing's reported return on equity (ROE) ratio was 14.1, representing a change of 1.0%. Its return factor metrics are even more remarkable when compared to their peers. Therefore, its return factors component earned a score of 74. That said, one metric, Revenue Efficiency, stood out as strongly negative. Bank of Nanjing management did an underwhelming job managing revenue efficiency this past period. Bank of Nanjing's revenue efficiency is 32717.0 according to the metrics in the current filing, which represents a 11.3% change from the previous report. This metric might have a 2.3 percent impact on companies in the same industry and with the same market capitalization. Their revenue efficiency does not make a compelling case for upward pressure on the company's stock price. Its revenue efficiency, therefore, received a grade of 48. their income statement received an overall score of 66.

Parameter Value Change Score
Total Revenues 32,717.0 11.3% 48
Return on Equity 14.1 1.0% 74
* All values are TTM

The below chart describes Bank of Nanjing's performance as reflected on its income statement with respect to its peers. While Bank of Nanjing received a income statement score of 66 , the average of its peers stands on 68.0.

  •  601009
  •  Peers average
Name Market Cap Revenue Momentum Earning Movement Return Factors Momentum Income Statement mc_sort Hidden
China Merchants Bank Co., Ltd. 1.1T 58 68 61 63 0 1
Industrial Bank Co., Ltd. 402.2B 48 67 73 67 1 1
Shanghai Pudong Development Bank Co., Ltd. 233.9B 80 67 54 61 2 1
China Everbright Bank Company Limited 160.4B 69 67 61 63 3 1
China Minsheng Banking Corp., Ltd. 150.8B 85 67 55 62 4 1
Bank of Jiangsu Co., Ltd. 100.3B 48 69 80 71 5 1
Bank of Beijing Co., Ltd. 95.8B 63 68 50 59 6 1
Bank of Shanghai Co., Ltd. 92.8B 66 67 61 64 7 1
Bank of Hangzhou Co., Ltd. 85.0B 48 66 82 70 8 1
Hua Xia Bank Co., Limited 79.1B 61 67 61 63 9 1
Bank of Chengdu Co., Ltd. 61.3B 44 68 75 68 10 1
Bank of Changsha Co., Ltd. 31.4B 57 68 58 62 11 1
QILU BANK CO., LTD. 22.4B 50 68 76 69 12 1
Bank of Guiyang Co.,Ltd. 21.2B 69 67 58 62 13 1
Jiangsu Changshu Rural Commercial Bank Co., Ltd. 20.6B 52 71 77 71 14 1
Bank of Xi'an Co.,Ltd. 16.2B 47 64 58 56 15 1
Xiamen Bank Co., Ltd. 15.6B 48 68 59 62 16 1
Zhejiang Shaoxing RuiFeng Rural Commercial Bank Co.,Ltd 12.2B 66 68 76 70 17 1
Jiangsu Zijin Rural Commercial Bank Co.,Ltd 10.5B 81 71 55 60 18 1
Wuxi Rural Commercial Bank Co.,Ltd 10.3B 54 69 61 64 19 1
Jiangsu Suzhou Rural Commercial Bank Co., Ltd 9.0B 84 69 77 73 20 1
Ping An Bank Co., Ltd. 281.2B 53 68 81 72 21 1
Bank of Ningbo Co., Ltd. 225.7B 55 68 76 70 22 1
Bank of Suzhou Co., Ltd. 22.1B 53 66 58 60 23 1
Qingdao Rural Commercial Bank Co., Ltd. 18.4B 62 67 57 61 24 1
Jiangsu Zhangjiagang Rural Commercial Bank Co., Ltd 11.1B 64 67 79 71 25 1
Jiangsu Jiangyin Rural Commercial Bank Co.,LTD. 9.3B 51 68 77 70 26 1

Cash Flow Analysis

Bank of Nanjing's cash flow report highlighted several concerning metrics. Bank of Nanjing's management was ineffective in materially improving CapEx, which now sits at -1825.6 and represents a -26.4% change from the previous report. This performance is all the more uninspiring relative to their peers and competitors. Therefore, their CapEx movement component earned a score of 48. Also, Bank of Nanjing's management was not successful in meaningfully improving their cash flow metrics. As of the current filing, they were reported as 14280.1 and represented a 4752.0% change from the previous period. Bank of Nanjing's net cash flow metrics are especially disappointing relative to their peers. Hence, their net cash flow earned a score of 49. However, we can draw some encouragement from Bank of Nanjing's momentum in cash flow management. Bank of Nanjing did a great job related to free cash flow this period, which stood at 5.9, representing a -43.5% change from the previous filing. Companies in the same industry and market capitalization are typically affected by this parameter by up to 9.3%. These free cash flow numbers show that management has executed well while generating cash flow and encouraging growth. Consequently, their free cash flow movement received a grade of 84. Its cash flow, therefore, earned a score of 54.

Parameter Value Change Score
Net Cashflow 14,280.1 4752.0% 49
Capital Expenditure -1,825.6 -26.4% 48
Free Cashflow 5.9 -43.5% 84
* All values are TTM

The below chart describes Bank of Nanjing's performance as reflected on its cash flow with respect to its peers. While Bank of Nanjing received a cash flow score of 54, the average of its peers stands on 67.0.

  •  601009
  •  Peers average
Name Market Cap Cashflow Momentum Free Cashflow Growth Capital Expenditure Growth Assets Factors Momentum Cash Flow mc_sort Hidden
China Merchants Bank Co., Ltd. 1.1T 90 45 44 69 68 0 1
Industrial Bank Co., Ltd. 402.2B 81 56 47 69 66 1 1
Shanghai Pudong Development Bank Co., Ltd. 233.9B 48 87 85 69 68 2 1
China Everbright Bank Company Limited 160.4B 43 95 54 69 56 3 1
China Minsheng Banking Corp., Ltd. 150.8B 84 45 91 69 79 4 1
Bank of Jiangsu Co., Ltd. 100.3B 93 41 90 69 84 5 1
Bank of Beijing Co., Ltd. 95.8B 67 67 92 69 75 6 1
Bank of Shanghai Co., Ltd. 92.8B 95 38 80 69 81 7 1
Bank of Hangzhou Co., Ltd. 85.0B 49 87 90 69 69 8 1
Hua Xia Bank Co., Limited 79.1B 80 57 69 69 75 9 1
Bank of Chengdu Co., Ltd. 61.3B 66 67 45 69 58 10 1
Bank of Changsha Co., Ltd. 31.4B 59 81 45 69 60 11 1
QILU BANK CO., LTD. 22.4B 81 54 90 69 80 12 1
Bank of Guiyang Co.,Ltd. 21.2B 67 67 90 69 75 13 1
Jiangsu Changshu Rural Commercial Bank Co., Ltd. 20.6B 71 73 81 69 80 14 1
Bank of Xi'an Co.,Ltd. 16.2B 43 90 62 67 51 15 1
Xiamen Bank Co., Ltd. 15.6B 93 40 85 69 82 16 1
Zhejiang Shaoxing RuiFeng Rural Commercial Bank Co.,Ltd 12.2B 96 37 44 69 69 17 1
Jiangsu Zijin Rural Commercial Bank Co.,Ltd 10.5B 46 99 50 67 53 18 1
Wuxi Rural Commercial Bank Co.,Ltd 10.3B 82 52 84 69 79 19 1
Jiangsu Suzhou Rural Commercial Bank Co., Ltd 9.0B 85 50 56 69 70 20 1
Ping An Bank Co., Ltd. 281.2B 91 42 96 69 85 21 1
Bank of Ningbo Co., Ltd. 225.7B 93 38 59 69 71 22 1
Bank of Suzhou Co., Ltd. 22.1B 61 78 49 69 61 23 1
Qingdao Rural Commercial Bank Co., Ltd. 18.4B 86 49 84 69 81 24 1
Jiangsu Zhangjiagang Rural Commercial Bank Co., Ltd 11.1B 39 98 84 69 64 25 1
Jiangsu Jiangyin Rural Commercial Bank Co.,LTD. 9.3B 42 94 51 69 53 26 1

This report is intended for general guidance and information purposes only and under no circumstances is tailored to a specific factor or variable related to its reader or intended to be used or considered as financial or investment advice, a solicitation of any offer, a recommendation, or an offer to sell or buy any securities or other form of a financial asset. For the full disclaimer, click here.