Huachuang Securities·2025-05-15 06:11Core Insights - The report maintains a positive outlook on bank sector investments, emphasizing the stability and dividend attributes of bank stocks, with an average dividend yield exceeding 4.3% [6][16] - The banking sector is expected to benefit from structural changes in the economy, leading to improved return on equity (ROE) and overall performance [7][10] Dimension One: Stability and Dividend Attributes of Bank Stocks - The core revenue growth of banks showed marginal improvement in Q1 2025, with a projected stable annual performance despite a slowdown in revenue and profit growth [10][11] - The average dividend payout ratio for listed banks increased to 26.1%, with an average dividend yield of over 4.3%, indicating strong dividend sustainability [16] - Major banks have received capital injections, enhancing asset quality and stabilizing market expectations, with non-performing loan ratios remaining steady at 1.16% [10][11] Dimension Two: Public Fund Reform and Increased Bank Allocations - The recent public fund reforms are expected to increase allocations to the banking sector, with potential incremental capital of approximately 222.7 billion yuan if funds align with industry benchmarks [10][12] Dimension Three: Influx of Long-term Capital - The acceleration of long-term capital inflows, particularly from insurance funds, is anticipated to provide additional support to bank stocks, with 14 cases of insurance fund acquisitions in 2025 [10][12] Dimension Four: Structural Economic Transformation and ROE Improvement - The banking sector's ROE is projected to stabilize between 8-9%, with potential for upward movement if economic conditions improve and structural transformations accelerate [7][10] Investment Recommendations - Emphasis on bank sector allocation, particularly focusing on state-owned banks and quality regional banks with strong provisioning coverage [7][10] - The report suggests a diversified investment strategy, highlighting the importance of dividend strategies and the potential for valuation improvements in selected banks [7][10]