PPOP struggles

■ 2Q21 net profit growth rebounded to 23.4% yoy (1Q21: 3.6% yoy; 1H21: 13%
yoy), driven by falling impairment charges amidst improving asset quality.
■ Unlike big bank peers, its 2Q21 pre-provisioning operating profit (PPOP)
growth was subdued at 1.7% yoy, and similar to 1Q21’s 2.8% yoy.
■ As we expect the base for 2H21F net profit growth to get more difficult, we
maintain our 5% net profit growth forecast for FY21F.
■ Reiterate Add rating with an unchanged TP of HK$4.10.