Bei Jing Shang Bao·2025-12-30 02:46Core Viewpoint - The A-share banking sector experienced a significant value reassessment throughout 2025, culminating in a total market capitalization exceeding 15.65 trillion yuan, marking a notable recovery and growth in the sector [1][2]. Group 1: Market Performance - The banking index increased by 12.06% over the year, with 42 listed banks achieving a combined market value growth of 15.37% compared to the end of 2024 [2]. - Agricultural Bank of China emerged as the standout performer with a 51.86% increase in stock price, surpassing Industrial and Commercial Bank of China in total market value [1][2]. - 35 out of 42 listed banks saw their stock prices rise, with several regional banks like Xiamen Bank and Chongqing Bank also showing strong performance, each exceeding a 20% increase [2]. Group 2: Valuation and Market Dynamics - The banking sector's price-to-book ratio showed signs of improvement, with some banks briefly exceeding a ratio of 1, indicating a shift away from the "broken net" situation that had persisted [4]. - The market's transition from valuation repair to value reassessment is attributed to improved investor confidence in banks' long-term profitability and asset quality [3][4]. Group 3: Policy and Economic Environment - The supportive policy environment, including interest rate cuts and liquidity injections, has created a favorable operating climate for banks, enhancing their appeal to long-term investors [8]. - The influx of long-term capital from insurance and pension funds into the banking sector has been driven by regulatory changes and a focus on stable returns [8]. Group 4: Future Outlook - The continuation of the value reassessment in 2026 will depend on macroeconomic stability, ongoing supportive policies, and confirmation of profit growth [9][10]. - The market is expected to experience a more structured performance, with large banks favored for their stability and certain regional banks potentially offering greater growth opportunities [10][11].