Huachuang Securities·2025-11-03 11:14Investment Rating - The report maintains a "Recommendation" rating for the banking industry, indicating a stable outlook for investment opportunities [1]. Core Insights - The core revenue capacity of the banking sector has strengthened, with net interest margins stabilizing and asset quality remaining robust. The overall performance of listed banks in Q3 2025 shows a slight increase in profit growth due to reduced provisioning [1][5]. - The overall revenue and net profit growth rates for the 42 listed banks in Q3 2025 are 0.9% and 1.5% year-on-year, respectively, reflecting a marginal decline compared to the previous half-year [9][10]. Summary by Sections 1. Q3 2025 Performance Overview - Revenue growth has slightly declined, with non-interest income support weakening. The revenue growth rates for the 42 banks are 0.9% and 1.5% for net profit, with a decline in growth rates for joint-stock banks, city commercial banks, and rural commercial banks [9][10]. - The profit growth rate has slightly increased, primarily due to a reduction in provisioning efforts. The net profit growth rates for state-owned banks, joint-stock banks, city commercial banks, and rural commercial banks are 1.2%, -0.2%, 6.9%, and 3.6%, respectively [10]. 2. Key Operating Indicators - The asset quality indicators remain stable, with non-performing loan ratios holding steady at 1.15%. The provisioning coverage ratio has slightly decreased to 283.2% [10]. - The return on equity (ROE) for listed banks remains above 10%, although it has decreased by 0.38 percentage points year-on-year to 10.8% [10]. 3. Investment Recommendations - The report suggests a diversified investment strategy focusing on banks with high dividend yields and strong asset quality. It highlights the potential for mid-sized banks with high provisioning coverage ratios and low-valued joint-stock banks with improving ROE [5].