On August 24, A-shares opened lower and pulled back, with nearly 4,000 stocks declining. However, the banking sector once again stepped in as a market stabilizer, with all 42 bank stocks trading in positive territory at the time of writing. Chongqing Rural Commercial Bank surged over 3%, while Xiamen Bank and China Citic Bank Corporation Limited (ASX: 601998) each gained more than 2%, with the latter reaching an all-time high. Other notable gainers included Suzhou Bank, Bank of Shanghai, Shanghai Rural Commercial Bank, and Huaxia Bank.
The Bank ETF Huabao (512800) strengthened alongside the sector's rally. As of August 21, 2026, the respective weightings of Chongqing Rural Commercial Bank, Xiamen Bank, China Citic Bank, Suzhou Bank, Bank of Shanghai, Shanghai Rural Commercial Bank, and Huaxia Bank within the CSI Bank Index stood at 1.12%, 0.32%, 1.30%, 1.19%, 2.95%, 1.56%, and 1.39%, respectively.
Recently, several listed banks including Ping An Bank, Bank of Nanjing, Bank of Jiangsu, and Bank of Ningbo have released their semi-annual reports. Based on the disclosed data, many banks have achieved positive growth in both operating revenue and net profit attributable to shareholders. Meanwhile, the industry-wide net interest margin has posted its first quarter-on-quarter recovery in nearly four years, signaling a clearer trend of operational improvement across the banking sector.
According to Zhongtai Securities, the certainty of full-year banking performance will generate steady returns for bank stocks in 2026. From a market style perspective, banks serve as relatively resilient holdings during flat market conditions, and their alpha potential in bull markets does not lag the broader index. During the three phases of market downturns in 2015-2016, 2018-2019, and 2021-2024, banks consistently outperformed in terms of downside resistance, with declines significantly smaller than those of the CSI 300.
From a capital and positioning standpoint, the reduction of holdings by the China Securities Finance Corporation is nearing its end, and the scale of broad-based index funds has fallen back to pre-2024 rescue levels, largely eliminating disturbances from state-affiliated institutional capital. In the short term, a seesaw effect with the technology sector persists, while long-cycle pricing remains anchored around return on equity and dividend yields.
*Orient Securities notes that since the third quarter, amid the rebalancing of market risk appetite and capital styles, a window for style realignment has emerged. With stable expectations for banking sector fundamentals in the interim reports, showing definitive improvement compared to the past three years, and combined with the defensive characteristics of high dividends, the sector is expected to maintain its current valuation recovery trend.
*Riding the momentum with both offense and defense! The Bank ETF Huabao (512800) and its feeder funds (Class A: 240019; Class C: 006697) passively track the CSI Bank Index, whose constituents include all 42 A-share listed banks, making it an efficient investment tool for tracking the overall banking sector performance.
·Data sources: Shanghai and Shenzhen stock exchanges, among others. Institutional viewpoints sourced from Zhongtai Securities on August 24, 2026, "Banking Analyst Dai Zhifeng: Unpacking the 'Dividend' Value of Bank Stocks — Absolute Returns from Fundamentals and Investment Perspectives"; and Orient Securities on July 26, 2026, "Banking Interim Report Fundamentals Expected Stable, Institutional Positioning at Historical Lows."
ETF fee disclosure: When investors subscribe to or redeem fund shares, the subscription/redemption agency may charge a commission of no more than 0.5%, which includes fees levied by stock exchanges and registration institutions. Feeder fund fee disclosure: For the Huabao CSI Bank ETF Feeder Fund (Class A), the subscription fee rate (front-end load) is RMB 1,000 per transaction for subscription amounts of RMB 2 million or above, 0.6% for amounts between RMB 1 million and RMB 2 million, and 1% for amounts below RMB 1 million. The redemption fee rate is 1.5% for holding periods of fewer than 7 days, 0.5% for holding periods from 7 days (inclusive) to 180 days, 0.25% for holding periods from 180 days (inclusive) to 1 year, and 0% for holding periods of 1 year (inclusive) or more. No sales service fee is charged. For the Huabao CSI Bank ETF Feeder Fund (Class C), no subscription fee is charged, the redemption fee rate is 1.5% for holding periods of fewer than 7 days, 0.5% for holding periods from 7 days (inclusive) to 30 days, and 0% for holding periods of 30 days (inclusive) or more. The sales service fee is 0.2%.
Risk disclaimer: The Bank ETF Huabao (512800) passively tracks the CSI Bank Index, with a base date of December 31, 2004, and a release date of July 15, 2013. The CSI Bank Index's returns over the past 5 full calendar years are: 2025, 6.79%; 2024, 34.71%; 2023, -7.27%; 2022, -8.78%; 2021, -4.41%. Volatility over the past 5 full calendar years is: 2025, 14.03%; 2024, 19.34%; 2023, 13.41%; 2022, 18.56%; 2021, 18.63%. The composition of index constituents is adjusted in accordance with the index compilation rules, and past performance does not indicate future results. The index constituents mentioned in this article are for illustrative purposes only, and descriptions of individual stocks do not constitute investment advice of any form, nor do they represent the holdings or trading activities of any fund under the fund manager's management. The fund manager assesses this fund's risk level as R3-moderate risk, suitable for investors with a balanced (C3) risk profile or above. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, and any form of expression) is for reference only. Investors must be responsible for their own investment decisions. Furthermore, any opinions, analyses, or forecasts in this article do not constitute investment advice to readers in any form, nor do they assume any responsibility for direct or indirect losses arising from the use of the content. Fund investment carries risks. A fund's past performance does not represent its future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of this fund's performance. Please invest in funds with caution.
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