Core Viewpoint - Several A-share listed banks have recently seen significant share purchases by their directors, supervisors, and major shareholders, indicating confidence in the banks' long-term value and stability in market sentiment [1][4]. Group 1: Shareholder and Management Purchases - Qilu Bank announced on November 7 that its directors and executives have completed 90% of their share purchase plan, amounting to approximately 3.15 million yuan, with a total planned investment of at least 3.5 million yuan [2][3]. - Qingdao Bank reported that its major shareholder, Guoxin Chanin Holdings, increased its stake to 15.42%, becoming the largest shareholder after purchasing 243 million H-shares for a total of 9.57 billion yuan [2][3]. - Over 10 banks have experienced similar share purchases since 2025, with a majority being city commercial banks [1][2]. Group 2: Financial Performance and Trends - The recent quarterly reports indicate a positive performance among listed banks, with 35 out of 42 banks reporting year-on-year profit increases, and seven banks achieving double-digit growth [5][6]. - Qilu Bank and Qingdao Bank led the profit growth among listed banks, with increases of 15.54% and 15.14%, respectively [6]. - The overall revenue of 42 A-share listed banks grew by 0.9% year-on-year, while net profit increased by 1.5%, driven by stable expansion and a narrowing decline in net interest margins [6][7]. Group 3: Net Interest Margin and Market Outlook - The net interest margin for many listed banks has shown signs of stabilization, with 19 banks reporting an increase compared to the first half of 2025 [6][7]. - City commercial banks have particularly benefited from improved profit growth and stable loan growth, contrasting with weaker performance in other bank types [7]. - Analysts predict a continued positive trend in net interest margins and overall profitability for the banking sector in 2026, despite potential pressures on asset quality, especially in retail [7].

Core Viewpoint - The continuous narrowing of net interest margin (NIM) has been a core issue affecting the profitability and valuation performance of Chinese banks, particularly China Bank, reflecting the deepening of interest rate marketization and changes in the macroeconomic environment. However, recent data suggests that this downward pressure may be nearing an end, indicating a potential turning point for the banking sector [1][2]. Group 1: NIM Stabilization - In Q3 2025, China Bank reported a stable NIM of 1.26%, halting a decline that began in H1 2023 when it was 1.67%. This stabilization is echoed by other banks, such as Jiangyin Bank and Ningbo Bank, which also reported stable or slightly improved NIMs [2][3]. - Jiangyin Bank's NIM rose to 1.56%, and Ningbo Bank maintained a NIM of 1.76%, indicating a positive trend across various types of banks [2][3]. Group 2: Factors Behind NIM Stabilization - The stabilization of NIM is attributed to a dynamic balance between asset and liability factors. On the asset side, the downward pressure on new loan pricing has eased, with the reduction in LPR (Loan Prime Rate) slowing down significantly [4][5]. - The growth rate of corporate loans for China Bank was 11.71%, significantly higher than the 0.56% growth in personal loans, which helps stabilize overall asset yield [4]. - On the liability side, the effectiveness of managing deposit costs is becoming evident, as many high-interest term deposits are maturing and being renewed at lower rates [5]. Group 3: Rise of Non-Interest Income - Alongside NIM stabilization, there is a notable shift in the banking business structure, with non-interest income becoming a more significant revenue source. For China Bank, non-interest income reached 165.41 billion yuan in the first three quarters, a 16.20% year-on-year increase, accounting for 33.67% of total operating income [7]. - This structural change indicates a shift in the banking profit model from solely relying on interest spread to a dual-driven approach of "interest spread + non-interest income" [7]. Group 4: Future Challenges and Opportunities - Despite positive signs of stabilization, the banking sector still faces significant challenges, including the absolute level of NIM remaining historically low. China Bank's NIM of 1.26% is still under pressure compared to international peers and its historical performance [8]. - The intensity and sustainability of economic recovery will directly impact credit demand and asset quality, posing risks to NIM stability [8]. - The future differentiation among banks will intensify, with those excelling in cost management, non-interest income development, and risk pricing likely to navigate through cycles more effectively [9].