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BOC Hong Kong Holdings Ltd 02388

Morningstar Rating
HK$22.65 −0.30 (1.31%)
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Company Report

BOC Hong Kong, Like Peers, Should See Stable Loans Growth but Declining Interest Margin

Bank of China Hong Kong's strong financial fundamentals and close connection with its parent, Bank of China, position it well, in our view, to benefit from rising economic integration between Hong Kong and the Greater Bay Area on both sides of the Pearl River. It has a long history operating in Hong Kong, where it has the second-largest market share of deposits after HSBC, and is competitive in offering cross-border banking services to its retail and wholesale clients. Its funding advantage from a large base of sticky deposits is complemented by tight cost control discipline, which has resulted in an industry-leading cost/income ratio of around 30%.

Price vs Fair Value

02388 is trading at a 740% premium.
Price
HK$22.65
Fair Value
HK$82.00
Uncertainty
Medium
1-Star Price
HK$75.24
5-Star Price
HK$64.70
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

BOCHK benefits from a strong connection with parent Bank of China, underpinning steady loan growth as BOCHK offers cross-border banking expertise to Chinese corporates seeking offshore investments.

Bears

BOCHK's credit quality and profitability may deteriorate if the Chinese and regional economies experience a sharp decline in economic activity.

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Trading Information

Previous Close Price
HK$22.95
Day Range
HK$22.5522.90
52-Week Range
HK$17.8626.10
Bid/Ask
HK$22.65 / HK$22.70
Market Cap
HK$239.47 Bil
Volume/Avg
5.0 Mil / 9.6 Mil

Key Statistics

Price/Earnings (Normalized)
6.22
Price/Sales
3.44
Dividend Yield (Trailing)
7.38%
Dividend Yield (Forward)
7.38%
Total Yield
7.38%

Company Profile

Bank of China Hong Kong, or BOCHK, is a subsidiary of Bank of China. It is the second-largest bank in Hong Kong in terms of loan and deposit market shares. Although BOCHK is legally separate from Bank of China, it maintains close relationships with it in management, administration, and business relations. The two companies also cooperate in several areas, including the reselling of Bank of China's insurance and securities services. Bank of China holds a 66% stake in BOCHK.
Sector
Financial Services
Industry
Banks - Regional
Stock Style Box
Large Value
Total Number of Employees
14,916

Competitors

Valuation

Metric
02388
O39
U11
Price/Earnings (Normalized)
6.229.539.93
Price/Book Value
0.751.221.26
Price/Sales
3.444.923.94
Price/Cash Flow
5.329.258.54
Price/Earnings
02388
O39
U11

Financial Strength

Metric
02388
O39
U11
Quick Ratio
Current Ratio
Interest Coverage
Quick Ratio
No chart available

Profitability

Metric
02388
O39
U11
Return on Assets (Normalized)
0.93%1.13%1.19%
Return on Equity (Normalized)
10.76%12.41%14.41%
Return on Invested Capital (Normalized)
Return on Assets
02388
O39
U11
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Banks - Regional Industry Comparables

1-Day Chart
Name
Price
Morningstar Rating for Stocks
Capital Allocation
Economic Moat
Market Cap
BNP Paribas ADR
BNPQY
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Intesa Sanpaolo ADR
ISNPY
SlyfxhgsvYdsg$71.6 Bil
U.S. Bancorp
USB
BlcscgnnTqwvy$69.8 Bil
PNC Financial Services Group Inc
PNC
ByqsyhmgPpqjtf$69.8 Bil
Truist Financial Corp
TFC
YrtrqhjvKtqst$56.7 Bil
Itau Unibanco Holding SA ADR
ITUB
GcxqpfthVhb$56.1 Bil
Mizuho Financial Group Inc ADR
MFG
JbbqxjbVbn$55.0 Bil
Lloyds Banking Group PLC ADR
LYG
BmbszrydRntrzts$47.7 Bil
NatWest Group PLC ADR
NWG
ZpjqvjxwMwsz$36.0 Bil
Deutsche Bank AG
DB
ZbgbPxm$32.3 Bil

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