15 Major Banks Distribute Over 570 Billion in Dividends! How to Choose Based on Dividend Yield, Stock Price, and Fundamentals

As the A-share market continues to debate “how the second half of the bull market should unfold,” banks have long already fed investors reassurance by rolling out streams of dividend figures. With the sequential disclosure of 2025 annual reports for listed banks, dividend plans for 6 state-owned banks and 9 A-share listed joint-stock commercial banks have officially been released. A total of 15 banks will distribute more than 570 billion yuan in cash dividends, using hard cash to demonstrate the industry’s earnings resilience. Behind these “big-spending” dividends is the growing investment value of the banking sector: the 15 banks’ average dividend yield exceeds 4.4%, outperforming returns on bank deposits and wealth-management products. In 2025, the banking sector moved higher amid volatility—Agricultural Bank of China’s full-year gain topped 52%, Industrial and Commercial Bank of China and Pudong Development Bank both surpassed 20%, and many banks saw standout stock-price performance. Faced with this generous set of “cash gifts,” how should investors make their choices? And how can they precisely capture the investment opportunities within while avoiding potential risks?

Total “cash gifts” exceed 570 billion yuan

As the A-share market moves forward amid fluctuations, high-dividend, low-volatility bank stocks have always been the steadiest “anchor” in the eyes of capital. The 15 large- and mid-sized listed banks delivered a combined answer of 576.478 billion yuan in total dividends for 2025. In this “hard-cash” dividend ledger, not only is there evidence of banks’ earnings resilience, but also there lies the “easy profit” playbook for ordinary investors.

Looking through this “dividend encyclopedia,” in terms of scale, the state-owned megabanks take the top tier. Industrial and Commercial Bank of China sits firmly at the top as the “dividend champion” with a total dividend of 110.593 billion yuan, continuing its long-standing steady style. China Construction Bank follows with 101.684 billion yuan; Agricultural Bank of China and Bank of China rank third and fourth with 87.321 billion yuan and 72.917 billion yuan, respectively. From the dividend payout ratios of the six state-owned banks, the distributions are basically maintained at 30% or even higher.

In 2025, the six state-owned banks together distributed more than 420 billion yuan in dividends, accounting for over 70% of the total dividends of the 15 banks—undoubtedly the “cash cow.” Behind the “scale dominance” are the huge asset base of the state-owned megabanks and a stable foundation for profitability. In 2025, all six major banks achieved “positive growth” in both revenue and net profit; total net profit exceeded 1.4 trillion yuan.

Different from the “step-by-step” approach of the state-owned megabanks, the dividend landscape of joint-stock banks shows clear divergence. China Merchants Bank led the joint-stock segment with a total dividend of 50.843 billion yuan; its dividend payout ratio of 35.34% also ranks near the top among the 15 banks, continuing the “king of retail” tradition of high returns. China Citic Bank’s dividend amount increased by 1.746 billion yuan year over year; its dividend payout ratio rose from 30.5% at the end of 2024 to 31.75%. Industrial Bank and Huaxia Bank also saw steady growth in dividend amounts, continuously stepping up distribution strength. However, against the backdrop of pressure on the performance of some listed joint-stock banks, the dividend scale of multiple banks has declined as well.

Wang Hongying, Director of the Institute of Financial Derivatives Investing Research (Hong Kong), stated that, from a structural classification perspective, large banks maintain dividend ratios at high levels thanks to their scale advantages and innovative growth in diversified fee-based businesses. The divergence among joint-stock banks reflects differences in their operating strategies.

Dividend yield, stock price, and dividends must be considered comprehensively

For investors, “more dividends” does not necessarily mean “more profit.” Only by combining dividend level, stock price gains, and dividend yield can you gauge the core metric of value for money.

Among them, dividend yield is an important indicator for investors to judge the long-term investment value of listed companies and a key reference for selecting income-oriented stocks. The calculation method is: dividend yield = (cash dividend per share / current share price) × 100%.

According to Wind data, as of the end of 2025, the average dividend yield of the 15 listed banks was 4.41%. Six banks had dividend yields above 5%: Huaxia Bank, Everbright Bank, Ping An Bank, China Minsheng Bank, Zheshang Bank, and Industrial Bank, with dividend yields of 5.9%, 5.42%, 5.24%, 5.17%, 5.13%, and 5.03%, respectively. China Merchants Bank, China Citic Bank, and Bank of Communications also had dividend yields above 4%.

Compared with bank deposit rates and wealth-management product yields, current net value performance for one-year bank wealth-management products is basically in the range of 2.2%—3%. Most mainstream R2-level fixed-income products fall in the 2.6%—2.8% band. Meanwhile, one-year time deposit interest rates are generally relatively low. State-owned megabanks and joint-stock banks typically apply the 1.1%—1.15% benchmark. Jumbo certificates of deposit have slightly higher rates, usually around 1.2%.

As for stock price trends, since 2025, the A-share banking sector overall has shown a pattern of “rising first, then weakening,” followed by a later repair—an upward move with fluctuations. In this round of trading, Agricultural Bank of China saw a particularly strong surge: it jumped 5.17% in a single day, with an intraday high reaching 7.55 yuan, setting a new historical high. Its total market value reached 2.55 trillion yuan, first surpassing Industrial and Commercial Bank of China to top the banking sector market-cap ranking. Wind data shows that in 2025, Agricultural Bank of China led the listed banks with a gain of 52.66%. Pudong Development Bank and Industrial and Commercial Bank both exceeded 20% for the year. Meanwhile, year-over-year gains for bank stocks such as China Citic Bank, Industrial Bank, China Construction Bank, and China Merchants Bank were in the 10%—16% range.

The logic behind the rise in bank stocks in this round differs from the old pattern of relying on an economic rebound and strong credit demand. Against the backdrop of “asset scarcity,” insurance capital has continued to increase holdings of bank stocks and triggered follow-on purchase mechanisms multiple times. A consensus has also gradually formed among retail investors: buying bank stocks is essentially equivalent to allocating to high-yield fixed-income products.

However, since this year, with volatility in the stock market, listed A-share banks have also entered a period of range-bound adjustments. Within the year, among 42 listed banks, more than half of their stock prices overall have fallen. For example, stocks that led gains last year—such as Pudong Development Bank—are now among the leaders in the decline rankings.

Wu Zewei, a special researcher at SuShang Bank, said that dividend yield equals payout ratio divided by price-to-earnings (P/E), and the stock price equals EPS multiplied by P/E. Changes in dividend yield and stock price show an inverse relationship. From this perspective, dividend yield is more suitable for reviewing the past than forecasting the future, because the historical purchase cost has already been locked in. We can roughly measure the level of stable returns generated by cash dividends based on dividend yield. But when forecasting the future, we must avoid getting trapped in a “valuation trap” in which falling valuations cause dividend yield to rise.

Wang Hongying believes that, from a “sleep-well and earn” perspective, dividend yield is the primary yardstick. It directly reflects the proportion of income that the invested principal can earn. Compared with simply treating the absolute dividend amount as the key metric, dividend yield more effectively shows the value-for-money of the investment. Dividend amount and stock-price movement can be used as supplementary references, but the core still lies in whether dividend yield is high. However, while focusing on return metrics, investors must never ignore fundamental factors of banks—for example, interest-rate spread, scale of non-performing loans, and the provision coverage ratio that reflects risk-control capability. Only when these basic indicators supporting commercial banks’ operating quality are within a reasonable range does a high dividend yield, stable payouts, and stock-price volatility have meaningful value worth discussing.

Can long-term holding be “sleep-well and earn”?

For the banking industry, which has entered an era of stock-based competition, sustained dividend returns are not only an important way to reward investors, but also direct proof of banks’ earnings quality, capital strength, and operational steadiness.

At earnings press conferences, in response to hot-button questions from investors—such as dividend policies, payout ratios, and long-term return planning—many banks’ management teams gave answers.

Liu Jun, President of Industrial and Commercial Bank of China, said: “For the long-term, sustainable, healthy development of the capital market, if there is indeed public demand in the capital market to further adjust upward the payout ratio, then as a market bellwether, Industrial and Commercial Bank of China will certainly work as the market does and think as the market thinks. In terms of dividend arrangements, we will closely observe changes in the capital market and the demand, and respond to everyone’s needs and calls.” Qi Gang, President of Huaxia Bank, pointed out that over the past three years, total dividends have increased year by year, and payout ratios have also risen year by year. In the future, the bank’s cash dividend policy will balance regulatory requirements, shareholders’ investment returns, and the company’s sustainable development needs. The bank will continue to enhance profitability and maintain a reasonable dividend payout ratio.

For investors, the core logic of selecting bank stocks has long shifted from “earning the money from growth in scale” to “earning the money from dividends and valuation recovery.” In the current market environment, banks with high dividends, low valuations, and steady asset quality remain the most value-for-money allocation direction.

In response, Wu Zewei mentioned two major screening standards: first, in the past, the target’s dividend yield must have been sufficiently attractive—at least significantly higher than the current 10-year government bond yield at maturity, implying enough risk premium versus the risk-free rate. Second, because investors’ goal is long-term holding to enjoy regular dividends, these targets’ dividends must have sufficient continuity.

Wu Zewei further reminded investors that you cannot put all the eggs in one basket. Whether choosing multiple bank stocks or combining equities, bonds, deposits, and other assets into an overall portfolio, such diversification is a necessary move to reduce risk and improve returns.

“From an investor’s perspective, when investing in bank stocks, first you need to focus on fundamentals, such as asset scale, interest-rate spread, provision coverage ratio, and non-performing loan ratio. Second, you need to pay attention to dividend yield, dividend distribution, and stock-price stability, to select suitable investment targets. If you adopt a steady approach, dividends from large banks are the preferred choice for long-term investment. For specialized and smaller banks with core competitiveness, you can hold a small portion.” Wang Hongying said.

Beijing Business Daily reporter Song Yitong

(Editor: Qian Xiaorui)

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