Summary of the Conference Call on Wealth Management Industry Outlook for 2026 Industry Overview - The report focuses on the wealth management industry in China, particularly in the context of deposit migration and new asset allocation narratives for 2026 [4][5]. Key Insights and Arguments 1. **Growth in Wealth Management**: In 2025, the wealth management industry experienced unexpected growth due to deposit migration and the release of floating profits, with a total scale reaching 33.7 trillion yuan, a year-on-year increase of 12.5% [16][4]. 2. **Future Opportunities**: The industry is expected to benefit from multi-asset layouts and a further decline in household savings rates in 2026, although it will face pressure from valuation adjustments [4][5]. 3. **Risk Appetite of Residents**: There is a slight upward trend in the risk appetite of Chinese residents, influenced by their asset-liability performance and historical changes in financial assets during Japan's low-interest era [5][25]. 4. **Deposit Migration**: In 2025, the average decline in retail deposit rates was approximately 30 basis points, with a notable slowdown in fixed-term deposits. Conversely, demand for demand deposits, bank wealth management products, and non-bank deposits increased [5][48]. 5. **Excess Savings**: From 2020 to 2025, an excess savings of 14.4 trillion yuan was generated, indicating potential for additional funds to flow into wealth management and other investment areas as savings rates decline [6][50]. 6. **Valuation Adjustments**: The report anticipates that wealth management products will face "true" net value adjustments in 2026, which may increase product volatility and challenge institutions to meet investor demands for stable growth [13][14]. 7. **Projected Growth**: The wealth management industry is expected to grow by approximately 8% in 2026, reaching a scale of 36 trillion yuan, with potential for further growth if the bond market stabilizes [14][15]. Additional Important Points 1. **Product Structure Trends**: The report predicts a continued demand for low-volatility, stable fixed-income products, while the growth of rights-based wealth management products is expected to increase [15][4]. 2. **Impact on Stock Market**: The anticipated increase in equity asset allocation by wealth management institutions could potentially inject nearly 1 trillion yuan into the capital market by 2027 [15][14]. 3. **Public Fund Outsourcing Demand**: There is a growing demand for bond ETFs and rights-based funds, driven by the need for enhanced returns and external collaboration [15][4]. 4. **Consumer Behavior**: The report highlights that despite the potential for increased risk asset allocation, the majority of wealth management products will still prioritize stability and safety due to the current risk appetite of residents [15][25]. 5. **Regulatory Environment**: The regulatory landscape continues to evolve, with institutions required to return floating profits to investors, which has supported product performance amid market volatility [19][22]. This summary encapsulates the key points from the conference call regarding the wealth management industry outlook for 2026, highlighting growth opportunities, challenges, and consumer behavior trends.

Investment Rating - The report provides a positive outlook for the wealth management industry, projecting an 8% growth in 2026, with potential expansion to 36 trillion yuan, and possibly up to 37.4 trillion yuan if market conditions improve [12][14]. Core Insights - The wealth management industry is expected to benefit from the trend of deposit migration and the release of existing floating profits, leading to unexpected growth in 2025 [3][14]. - In 2026, wealth management institutions will have opportunities for multi-asset allocation and a further decline in household savings rates, but they will also face pressure from valuation adjustments [3][4]. - The report emphasizes the importance of understanding the changes in residents' risk preferences and the implications for asset allocation, indicating a shift towards more liquid deposits and asset management products [23][39]. Summary by Sections Resident Risk Preferences - The report suggests that in 2026, residents will have a slight increase in risk appetite, leading to a trend of liquid deposits and asset management products [4][23]. - The potential for increased allocation to rights products is noted, although the growth elasticity may not be significant at this stage [4][23]. Deposit Migration Trends - In 2025, the average decline in retail deposit rates was approximately 30 basis points, with a notable slowdown in the growth of fixed-term deposits [4][44]. - The report anticipates that in 2026, 32 trillion yuan of fixed-term deposits will mature, with a re-pricing range of 70-170 basis points, creating conditions for further deposit migration [4][45]. Fund Flow from Excess Savings - The report estimates that from 2020 to 2025, there will be a total of 14.4 trillion yuan in excess savings, with a potential additional 2-4 trillion yuan flowing into non-fixed deposit investment areas in 2026 [5][46]. - A decrease in the savings rate by 1 percentage point could lead to an additional 0.9 trillion yuan in new funds directed towards wealth management, funds, insurance, and real estate [5][46]. Wealth Management Asset Allocation Outlook - The report predicts that pure fixed-income wealth management products will grow by 7.5% to 24.9 trillion yuan in 2026, contributing significantly to the overall growth of the industry [13][14]. - The demand for public fund outsourcing, particularly for bond ETFs and rights funds, is expected to grow rapidly, driven by the need for enhanced returns [13][14]. Valuation Adjustment and Market Conditions - The report highlights that wealth management products will face "true" net value adjustment pressures starting in 2026, which may lead to increased product volatility [11][54]. - The need for wealth management institutions to effectively meet investor demands for stable value growth while managing expectations is emphasized as a key challenge [11][54].

Core Viewpoint - The wealth management industry is expected to achieve unexpected growth in 2025, driven by deposit migration and the release of existing floating profits, while facing valuation adjustment pressures in 2026 [2] Group 1: Resident Risk Preference Insights - In 2026, residents are expected to show a slight increase in risk appetite, leading to a trend of more liquid deposits and asset management products [4] - The average decline in retail deposit rates in 2025 was approximately 30 basis points, with a significant slowdown in new fixed-term deposits, while demand for liquid deposits and wealth management products increased [4] - A total of 32 trillion yuan in fixed-term deposits will mature in 2026, with a repricing range of 70-170 basis points, indicating potential for further deposit migration [4][19] Group 2: Fund Flow from Excess Savings - From 2020 to 2025, an excess savings of 14.4 trillion yuan was generated, with a projected decrease in the savings rate to around 14.6% in 2025 [5][26] - A 1 percentage point decrease in the savings rate could release approximately 0.9 trillion yuan into wealth management, funds, insurance, and real estate [5][26] - The potential for an additional 2-4 trillion yuan in activated funds flowing into non-fixed deposit investments in 2026 is anticipated [5][26] Group 3: Wealth Management Asset Allocation Outlook - The wealth management industry is expected to see a growth rate of 8% in 2026, expanding by 2.6 trillion yuan to reach 36 trillion yuan, despite challenges from valuation adjustments [29] - Low-volatility fixed-income products will remain the core offering, while the growth of rights-based wealth management products is expected to accelerate [30][31] - The supply of long-term closed-end wealth management products is anticipated to increase due to the need for stable liabilities and the development of retirement financial products [36] Group 4: Market Impact and Fund Inflows - Wealth management institutions are projected to increase their equity asset allocation by 0.8 percentage points to 2.3% in 2026, potentially bringing nearly 1 trillion yuan in incremental funds to the capital market [6][39] - The demand for bond ETFs and rights-based funds is expected to grow rapidly, driven by external collaborations and the need for wealth management institutions to enhance returns [6][39] - The third phase of public fund fee reform may lead to increased allocation of bond ETFs by wealth management institutions, while short-term pure bond funds may face redemption pressures [6][39] Group 5: Supply-Side Reform Opportunities - The supply-side reform in wealth management is accelerating, with smaller banks exiting the wealth management business, creating opportunities for leading institutions to increase market share [49] - The market share of the top five wealth management institutions is expected to rise as regulatory tightening continues to limit the issuance of new wealth management licenses [49]