The banking sector showed strong activity on June 12th. The leading 100-billion-yuan banking ETF, Huabao (512800), opened lower but moved higher, extending gains further in the afternoon session with its on-market price currently up 1.25%.
Fund inflows continued the recent trend of significant accumulation. Data from the Shanghai Stock Exchange shows that Huabao's banking ETF (512800) attracted another substantial inflow of 612 million yuan yesterday, with cumulative net inflows over the past five days exceeding 1.5 billion yuan.
Most individual stocks traded in positive territory. Bank of Xi'an Co.,Ltd., Ping An Bank Co., Ltd., Xiamen Bank Co.,Ltd., Bank of Communications Co., Ltd., and Suzhou Rural Commercial Bank Co.,Ltd. rose over 2%. More than ten stocks, including Postal Savings Bank Of China Co.,Ltd., China Merchants Bank Co.,Ltd., and Agricultural Bank Of China Limited, gained over 1%. China Construction Bank Corporation (ASX: CCB) once again reached a new historical high.
Listed banks have begun intensively announcing their 2025 profit distribution implementation plans, signaling a "dividend rain" is coming! So far, 17 listed banks have disclosed their 2025 profit distribution implementation announcements. The seven banks planning to execute payouts this week have a combined dividend total exceeding 33.1 billion yuan. Combined with already distributed interim dividends, the total annual payout amounts to 65.073 billion yuan.
Overall, A-share listed banks' total proposed dividends for 2025 amount to 645.6 billion yuan, setting another historical record. Among them, the six major state-owned banks account for 427.4 billion yuan in dividends, with payout ratios generally maintained at 30% or above. In the context of long-term interest rates remaining low and fluctuating, the banking sector maintains a sustained appeal for long-term capital.
Brokerage Perspectives on the Sector
Guosheng Securities stated that the core investment focus for the current banking sector is the valuation recovery driven by the restorative growth of core operating revenue. The banking sector possesses strong certainty for profit recovery and high-dividend attributes, further highlighting its cost-effective, balanced investment profile for both offense and defense.
CITIC Securities believes marginal improvements in capital flows make absolute returns promising. The peak impact of ETF net redemptions on the banking sector has passed, leaving limited room for further shocks. Looking ahead to the second half of the year, as banks enter a channel of fundamental recovery, sector valuation increases are anticipated. Furthermore, sustained dividend yields continue to attract low-risk-preference capital, suggesting a strong potential for absolute returns with relative certainty.
Key Instrument for Sector Exposure
Riding the trend, the banking ETF (512800) and its feeder funds (Class A: 240019; Class C: 006697) passively track the CSI Bank Index. The index's constituent stocks encompass 42 A-share listed banks, making it an efficient investment tool for tracking the overall performance of the banking sector. The banking ETF (512800) has a fund size exceeding 100 billion yuan, with an average daily turnover of over 700 million yuan since 2025, making it the largest and most liquid among the ten banking sector ETFs in the A-share market.
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