Research On Value Valuation Of Joint-stock Commercial Based On Improved Residual Income Model

In recent years,the complex and changeable international situation and the continuous spread of the new crown epidemic have been greatly threatened by the continuous liberalization of China’s private banks,the fierce inter-industry competition in the banking industry,the marketization of interest rates and the acceleration of financial development.Therefore,it is extremely necessary to conduct a scientific and reasonable value assessment of joint-stock commercial banks at this stage and find a value assessment model suitable for China’s jointstock commercial banks.In this thesis,Ping An Bank,a representative of joint-stock commercial banks,is selected as a research case study to explore the rationality of improving the residual income model in joint-stock commercial banks.On this basis,this thesis first sorts out the research of domestic and foreign scholars on the valuation of the banking industry,analyzes the particularities of the business structure,business model and risk of commercial banks,compares and analyzes the applicability of the three traditional asset valuation methods to joint-stock commercial banks,and concludes that the residual income method has a stronger interpretation of the value of joint-stock commercial banks.Nevertheless,when using the residual income method for empirical analysis,there are still problems such as flawed forecasting period settings and inaccurate future value predictions.In order to explore a method that is more suitable for evaluating the value of China’s jointstock commercial banks,this thesis introduces Du Pont financial analysis system and priceearnings ratio model according to the characteristics of Ping An Bank,and makes improvements and adjustments to the traditional residual income model,so as to avoid the problems of difficult calculation and poor prediction effect of the traditional residual income model.In addition,this thesis combines the inherent particularities of commercial banks,corrects the sales revenue and sales net profit,and uses the dynamic NS model to measure the risk-free return rate,so that the calculation relationship between the data is clear and the calculation result is more in line with the market value.At the same time,this thesis also draws on the three-stage residual income model adjusted by risk factors,which provides a useful reference for accurately calculating the value after the forecast period.In the case study,this thesis introduces the operating conditions and financial analysis of Ping An Bank,and applies the improved residual income model to the valuation of Ping An Bank based on the above influencing factors of Ping An Bank’s value.Using the improved residual income model,the total market value of Ping An Bank as of December 31,2021 was375.96 billion yuan,and the price of a single stock was 19.37 yuan per share,which was compared with the actual market value of 315.25 billion yuan,and it was found that the market failed to reflect the true value of Ping An Bank,and its value was seriously underestimated.The author summarizes the conclusions of other scholars after evaluating the value of the banking industry,and finds that the entire banking industry has high profitability and low valuation.The reasons for this can be attributed to the development of the times and the challenges of financing,the serious profit-seeking phenomenon of public funds,the relatively large proportion of individual stock investors in China,and the inherent subjectivity of the residual income method.By enriching the evaluation methods of joint-stock commercial banks,it will help boost the confidence of bank stock investors,enable them to make more accurate decision-making and deployment,and provide scientific basis and data support for the banking industry to expand market scale,upgrade and transform,and avoid credit risks,which is conducive to the vigorous development of joint-stock commercial banks.