Banking – In-depth – [OVERWEIGHT] – On the path to recovery

With the economic recovery, 2H2024 credit demands could accelerate and grow higher than in 2023. NIM could regain improvement from 2Q24 and 2H2024 after slightly falling in 1Q24. Other integrated banking services could also warm up. Despite an increase in non-performing loans again in 1H2024, we expect this situation to improve amid better business conditions in 2H2024. We forecast that the banking industry’s profits could grow double-digit in 2024, resulting from higher credit demand, NIM retrieval, improvements in fee incomes, and controllable operating expenses. Along with recovery prospects, the industry valuation is still attractive. When some large banks surged significantly YTD, investment opportunities could choose the remaining ones.