citic group performance exchange meeting: finance should return to its roots, and risks in the real estate industry are being resolved
2024-09-05
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"from the perspective of financial business, the new nine national regulations require the securities industry to return to the origin of finance and handle the relationship between functionality and profitability." on september 4, yang quanying, deputy general manager of the finance department of citic group, stated at the 2024 performance communication meeting that in terms of listed companies, citic group will strengthen market value management and improve return levels around the "nine national regulations."
data shows that citic group achieved revenue of 377.6 billion yuan in the first half of this year, a year-on-year increase of 13%. it achieved a net profit of 56.7 billion yuan and a net profit attributable to the parent company of 32.1 billion yuan, a year-on-year decrease of 1.3% and an increase of 0.1% respectively.
citic group pointed out that the financial sector maintained stable performance amidst a downward trend in bank interest spreads and a sluggish capital market; the two advanced sectors continued to promote high-end, intelligent and green transformation, and their market competitiveness continued to improve; but the two new sectors were adversely affected by slowing demand and their operating performance declined.
yang quanying proposed "two ideas" for future internal management. the first is to strengthen transformation and upgrading, that is, to accelerate the transformation into a group of leading enterprises in the industry; the second is to pay close attention to the expansion of strategic emerging industries such as low-altitude economy and biomanufacturing, and to occupy a place in future trending emerging industries through the strength of citic finance and industry.
the financial industry should return to its roots and properly handle the relationship between functionality and profitability
"in terms of financial business, the new nine articles require the securities industry to return to the origin of finance and handle the relationship between functionality and profitability." on september 4, yang quanying, deputy general manager of the finance department of citic group, stated at the 2024 performance communication meeting that citic will continue to support companies such as citic bank, citic securities, and citic construction investment to provide customer-centric capital market services.
data shows that citic group's comprehensive financial services sector achieved revenue of 139.8 billion yuan in the first half of 2024, and net profit attributable to parent company shareholders was 27.9 billion yuan, up 1.1% and 1.3% year-on-year respectively. among them, citic bank and citic securities still achieved the largest operating income in their financial sector, but their net profits both declined year-on-year.
"the securities sector must serve as the gatekeepers of the capital market." yang quanying said that to build a world-class investment bank, we must strictly control the access to listing and issuance, raise project access standards, improve business capabilities, further sort out various systems, and first create high-quality investment banking services.
regarding banks, yang quanying pointed out that it is necessary to strengthen services to the real economy, solve the problems of difficulty and high cost of financing for enterprises, and promote the important development of the real economy.
in addition, regarding citic bank's net interest margin, jin zhihong from the bank's asset and liability department predicts that although the interest margin in the second quarter is higher than that in the first quarter, from the perspective of the whole year, the interest margin will still decline further in the future due to the impact of the overall downward trend in asset prices and the regularization of deposits.
as risk mitigation is underway, the non-performing loan ratio in key areas such as real estate is declining
in recent years, citic group has been actively promoting risk resolution.
zhang yunting, joint company secretary and director of the board office of citic limited, said that in recent years, the company has conducted in-depth reviews, strengthened the construction of a comprehensive risk compliance system, strengthened the penetrating management of risk consolidation, strictly required "house cleaning", strictly controlled the use of the citic brand, established normalized risk management, and established a responsibility traceability mechanism.
data shows that at the end of june, the concentration of citic group's real estate industry and government financing platform remained the same or decreased compared with the previous year, and the non-performing rate decreased by 0.53 percentage points and 0.25 percentage points compared with the previous year. the risks of evergrande trust project and guizhou zunyi project have been effectively dealt with.
zhang yunting also proposed "five breakthroughs", namely, certain breakthroughs have been made in strengthening team building, restructuring the organizational system, improving the incentive mechanism, deepening scientific and technological innovation, and coordinating overseas development.
in addition, according to citic group's data, in the first half of this year, the company's real estate development and operation business made every effort to promote project delivery and settlement. key real estate projects such as suzhou wuzhong and changsha longping were successfully delivered, and the real estate development business achieved revenue of 7.2 billion yuan, a year-on-year increase of 204%. citic group also took multiple measures to strengthen sales and "compensate for volume with price" to increase promotional activities for projects such as ningbo fenghua; at the same time, taking advantage of the policy window, the government repurchased 596 residential units in the qingdao langya county project, all of which were used for affordable housing.
we are studying to formally include market value management in the scope of business assessment
"citic group is studying to formally include market value management in the scope of business assessment." yang quanying said at the performance release conference that the market value management level of 10 subsidiaries including citic bank, citic securities, and citic special steel will be strengthened to enhance the ability to return to shareholders. at the same time, the company will stabilize dividends and improve the certainty of expectations. it requires each listed subsidiary to reasonably formulate a dividend rate based on its own operations, strive to lead the industry in shareholder returns, and increase the frequency of dividends.
in fact, as a comprehensive or diversified company, citic group faces many challenges in terms of market value. citic bank is the ballast of citic group, with a very high proportion of assets, revenue and profit, which makes citic group face the dual impact of comprehensive enterprises and banking industry discounts.
zhang yunting introduced that, in general, citic group has started to carry out market value management in the second half of 2021, and the 1.0 version of the reform plan for systematically promoting citic group's market value management was officially implemented in 2022. from 2021 to 2023, citic group's share price rose by 48.76%, 15.87% and 1.96% respectively. during the same period, hong kong's hang seng index fell by 14.08%, 15.46% and 13.82% respectively. this means that relative to the general trend, citic group's share price reflects the effectiveness of the market value management reform.
"this year, citic will gradually launch the 2.0 version of the market value management reform plan." zhang yunting said that this year, the company will fully promote the formal assessment of market value management, and all of citic's 11 listed subsidiaries should be included. citic will focus on the price-earnings ratio and select key indicators for targeted assessment. at the same time, citic's functional departments will also be assessed on market value management related indicators.
jiang fan, financial reporter of beijing news shell
editor: yue caizhou
proofread by yang xuli
