On November 4, high-dividend assets continued their upward trend, with the banking sector leading the gains. Xiamen Bank (601187.SH) topped the list with a 5.92% increase, closing at CNY 7.52 per share. Other notable performers included Jiangsu Jiangyin Rural Commercial Bank (002807.SZ), China Citic Bank (601998.SH), Bank of Shanghai (601229.SH), and Bank of Chongqing (601963.SH), all rising over 3%, while most other bank stocks also closed higher.
With the completion of Q3 earnings disclosures for A-share listed companies, details of insurance capital allocations have emerged. Agricultural Bank of China (601228.SH) saw the most significant new investment from insurers, as Ping An Life Insurance became a top-ten shareholder in Q3, holding 4.913 billion shares, or 1.4% of the total. Other banks, including Industrial and Commercial Bank of China (601398.SH), Bank of Nanjing (601009.SH), Wuxi Rural Commercial Bank (600908.SH), and Jiangsu Changshu Rural Commercial Bank (601128.SH), also welcomed new insurance capital into their top-ten shareholder lists.
Insurance capital continued to increase holdings in several banks during Q3. For instance, Dajia Life Insurance raised its stake in Industrial Bank (601166.SH) by 62.12 million shares, while China Life Insurance boosted its positions in China Citic Bank and Bank of Suzhou (002966.SZ). Lian Life Insurance also increased its holdings in Jiangsu Changshu Rural Commercial Bank.
Industry statistics show that, excluding Ping An Group’s stake in Ping An Bank and China Life Group’s holdings in China Life, insurance institutions’ A-share holdings grew 14% quarter-on-quarter by the end of Q3, with total holdings exceeding CNY 650 billion, up CNY 100 billion from year-end 2022. Financial stocks accounted for nearly 50% of insurers’ total holdings, with a market value surpassing CNY 300 billion.
Insurance capital remains a core driver of bank stock gains. In recent years, high-dividend strategies have gained traction. Banks, with their attractive dividend yields and low valuations, have become a preferred choice for long-term investors like insurers. As of October 31, the banking sector’s average price-to-book ratio stood at 0.54x, with a dividend yield of 4.02%, making it a defensive asset amid declining market interest rates.
Pacific Securities noted that the banking sector is poised for a favorable configuration window in 2025, supported by falling interest rates, policy support, and bottom valuations. Under the IFRS 9 accounting standards, insurers’ FVOCI accounts have reinforced their preference for high-dividend, low-volatility assets like bank stocks, which serve as tools for extending duration and smoothing profits.
Huatai Securities analysts highlighted that insurance capital, industrial capital, and foreign investment will likely be key incremental buyers. Regulatory efforts to channel long-term funds into equities are expected to drive further insurance capital inflows, with banks—particularly those offering stable earnings and high dividends—remaining top picks.
Looking ahead, the banking sector’s strength is expected to persist, with insurers’ allocation logic unchanged. The robust performance of insurance investments has already contributed to record profits for major insurers in Q3, underscoring the sector’s appeal as a core growth driver.
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