德意志银行-香港银行业-hong kong banks 1h17 preview,nim transmission from higher rates remains a key focus-20170725-deutsche bank

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1、DeutscheBankMarketsResearchAsiaIndustryDateHongKongHongKongBanks25July2017Banking/FinanceBanksResultsFrancoLam1H17preview:NIMtransmissionfromResearchAnalyst(+852)22036226higherratesremainsakeyfocusfranco.lam@db.com1H17preview:fundamentals’strengthpricedinbythemarketToppicksBenefitingf

2、romthehigherratesin1H17,thesharepricesoftheHKbankingDSBG(2356.HK),HKD16.94Buysectorhavedonewellsofar,rising21%YTD,inlinewithMSCIHK.HeadingDahSingFinancial(0440.HK),HKD57.35Buyintointerimresults,weexpectfundamentalstolookstrong,helpedbyhigherSource:DeutscheBankmargins,bettermarketactiv

3、ity,seasonallyloweroperatingcostsandbenignassetquality.Whilecoreearningsareexpectedtoimprove9%HoH(+11%CompaniesFeaturedYoY),werecentlydowngradedBoCHKtoSellasmostofthepositivecatalystsarealreadyintheprice.WemaintainourSellcallonBEAandHoldonHSB.BOCHongKongHoldingsSell(2388.HK),HKD37.55D

4、SB/DSFremainouronlyBuysinHKbanks.2016A2017E2018E1H17results:NIMprogressionandguidancewillbekeyfocusesP/E(x)4.713.913.8TheHKbankswillkickofftheir1H17earningsseasonstartingwithHSBon31Divyield(%)7.73.73.4JulyandthroughoutAugust.Withinthebankscovered,BEAshouldseethePrice/book(x)1.31.71.6b

5、estearningsrecoverythroughsubstantiallylowercreditcosts,whileweHangSengBank(0011.HK),HKD165.70Holdexpectmodestimprovementbylargerbanks.Themajorfocusforinvestorswill2016A2017E2018EbethemagnitudeofNIMexpansiontransmittedthroughhigherrates(averageP/E(x)16.117.416.21M/3MHIBORincreasedby13

6、/26bpsvs.2H16).However,withtheseratesDivyield(%)4.54.04.3retreatingbyavg.14/15bpsin2Qand1/12bpsinJuly,NIMguidancewillalsoPrice/book(x)2.12.32.2beanothercrucialfocusforinvestorsintheseresults.Netinterestmargin:ThehigheraverageinterbankrateswillseeanBankofEastAsiaLtd(0023.HK),HKD33.50S

7、ellimprovementinNIMsin1H17−HSBandBOCHKshouldbenefitthemost2016A2017E2018EduetobiggerUSD/HKDbalancesheetsandhigherCASAproportions.P/E(x)24.211.618.1Divyield(%)1.93.12.4Loangrowth:SystemgrowthremainedstrongtillMay’17,uptoc.8%YTD,Price/book(x)1.01.11.1ledbyoffshore(+12%YTD)anddomesticlo

8、ans(6