Zheng Quan Ri Bao·2025-06-12 16:40Core Viewpoint - The recent announcements from Nanjing Bank and other banks regarding the triggering of conditional redemption clauses for convertible bonds indicate a significant trend in the banking sector, driven by the recovery of bank stock valuations in a low-interest-rate environment [1][2][3]. Group 1: Triggering of Redemption Clauses - Nanjing Bank announced that its "Nanjing Convertible Bond" has triggered the conditional redemption clause, with the stock price exceeding 130% of the conversion price for 15 out of 19 trading days [2]. - Other banks, including Hangzhou Bank and Suzhou Bank, have also triggered similar redemption clauses for their convertible bonds this year [2][3]. - The trend of triggering redemption clauses is attributed to the strong performance of bank stocks, which have been bolstered by a focus on absolute returns and low volatility strategies attracting long-term capital [3]. Group 2: Supply Constraints in the Market - The supply of new convertible bonds is expected to remain low due to stringent regulatory requirements and the financial health of banks, with many banks currently trading below their net asset value [5]. - The low willingness of bondholders to convert their bonds into equity further complicates the situation, making forced redemption a crucial mechanism for banks to enhance their core Tier 1 capital [4][5]. - As a result, the market for bank convertible bonds is likely to experience a slowdown in issuance and a reduction in overall scale, while existing bonds may attract significant investor interest due to their scarcity [5].