Over 10% excess growth in March, bank resilience stands out! The six major state-owned banks collectively saw double growth in revenue and net profit, with Bank of China and Agricultural Bank rising over 3% against the trend.

On the last day of March, the three major A-share indices all closed lower, with the banking sector stubbornly rising, and individual stocks broadly in the green. Bank of China and Agricultural Bank of China rose over 3%, while Pudong Development Bank, China Construction Bank, Huaxia Bank, and others increased over 1%. The intra-day price of the Huabao (512800) onshore bank ETF surged over 1%, approaching the half-year moving average, closing up 0.88%.

Reviewing the performance since March, Middle Eastern geopolitical risks have continued to disturb market sentiment, with the banking sector frequently showing counter-market performance. The CSI Bank Index has increased by 3.83% this month, ranking first among all CSI secondary industry indices. During the same period, the Shanghai Composite Index, ChiNext Index, and Shenzhen Component Index fell by 6.51%, 3.79%, and 7.02%, respectively, with the banking sector outperforming the Shanghai Composite by an excess of 10.34%.

Note: The CSI Bank Index’s total return over the past five full years is: 2025, 6.79%; 2024, 34.71%; 2023, -7.27%; 2022, -8.78%; 2021, -4.41%. The composition of index constituent stocks is adjusted periodically according to the index rules; past performance does not predict future results.

Additionally, represented by the six major state-owned banks, the steady performance of the banking sector also provides investors with confidence. Announcements show that the six major state-owned banks—Industrial and Commercial Bank, Agricultural Bank, Bank of China, China Construction Bank, Bank of Communications, and Postal Savings Bank—achieved double growth in revenue and net profit in 2025, with core operational indicators improving quarter by quarter. Moreover, the six banks continued their large-scale dividend distributions, with a total proposed dividend payout exceeding 400 billion yuan for the year.

Guosheng Securities pointed out that, given the current situation, geopolitical uncertainties remain, and appropriately reducing positions or increasing defensive, low-volatility allocations remains an important strategy to cope with amplified volatility. Priority should be given to banks and other sectors with relatively certain profit models and dividend returns.

Regarding the future market logic, Galaxy Securities stated that short-term risk aversion needs favor the allocation of banking stocks. The subsequent recovery is expected to come more from fundamental improvements, with 2026 earnings potential further released. In an environment of low interest rates and accelerated long-term capital inflows, the high dividend yield and low valuation attributes of banking stocks continue to attract long-term funds such as insurance capital, accelerating valuation restructuring.

The bank ETF (512800) and its associated funds (A: 240019; C: 006697) passively track the CSI Bank Index, which includes 42 listed banks in A-shares, serving as an efficient investment tool for tracking the overall banking sector trend. The latest size of the bank ETF (512800) is nearly 12 billion yuan, with an average daily trading volume exceeding 800 million yuan since 2025, making it the largest and most liquid among the 10 banking ETFs in A-shares.

Data source: Shanghai and Shenzhen Stock Exchanges, etc.

Institutional views sourced from: Guosheng Securities, 20260331 “April Strategy Outlook and Top Stock Picks: Balancing Low-Volatility Defense and Earnings Certainty”;

ETF fee-related notes: When investors subscribe or redeem fund shares, the authorized agencies may charge a commission not exceeding 0.5%, including related fees charged by stock exchanges, registration agencies, etc. Fee details for associated funds: Huabao CSI Bank ETF (A) subscription fee (front load) is 1,000 yuan per transaction for subscriptions of 2 million yuan or more; 0.6% for 1-2 million yuan; 1% for less than 1 million yuan. Redemption fee: 1.5% if held less than 7 days; 0.5% for 7-180 days; 0.25% for 180 days to 1 year; 0% for over 1 year. No sales service fee is charged. Huabao CSI Bank ETF © does not charge a subscription fee; redemption fee is 1.5% if held less than 7 days, 0% if held 7 days or more; sales service fee is 0.4%.

Risk warning: The bank ETF passively tracks the CSI Bank Index, which was launched on December 31, 2004, and published on July 15, 2013. The index composition is adjusted periodically according to the index rules; past performance does not predict future results. The index constituent stocks shown are for display only; individual stock descriptions do not constitute investment advice and do not reflect holdings or trading activity of any fund managed by the fund manager. The risk level of this fund, as assessed by the fund manager, is R3—medium risk, suitable for balanced (C3) and above investors. All information in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, or any form of statement) is for reference only. Investors are responsible for their own investment decisions. The views, analysis, and forecasts in this article do not constitute any form of investment advice and the fund manager is not responsible for any direct or indirect losses resulting from the use of this content. Fund investments carry risks; past performance does not guarantee future results. The performance of other funds managed by the fund manager does not guarantee the performance of any particular fund. Investment should be cautious.

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