CITIC Securities: Listed banks' revenues are expected to improve and performance remain stable by 2025. Preferential targets with solid fundamentals and high dividends.

People’s Finance Network, April 8 — A summary of China Securities Construction & Investment Bank Industry 2025 Annual Report says that in 2025, both revenue and profit for listed banks achieved modest positive growth, with an improving trend. The decline in net interest margin (NIM) has continued to narrow, and non-interest income has warmed up; the core revenue of listed banks has returned to a positive growth range. Loan demand has not shown improvement, and the scale growth rate remains steady. With cost optimization on the funding side, the NIM was basically stable at the margin in the fourth quarter. With wealth management gradually recovering, non-interest income growth accelerated; amid fluctuations in the bond market, other non-interest items maintained low double-digit growth. Asset quality met expectations. The non-performing loan generation rate increased month over month. Corporate real estate risks continued to remain exposed, while retail and SME risks have not shown a turning point. Looking ahead to 2026, as the decline in NIM narrows and other non-interest income does not drag as much, revenue is expected to continue improving, and profits can maintain stable growth. With the bottoming out of the banking industry’s actual operations and expectations further being reinforced, the sector has strong defensive and risk-hedging attributes, and trading strategy should mainly focus on hedging the market. Within the sector, stocks may rotate frequently based on short-term fundamentals and dividend yield relative pricing. It is recommended to take into account high-quality targets with both excellent fundamentals and solid dividend yields.