Summary of Key Points from the Conference Call Industry Overview - **Industry**: China Financials - **Date**: October 15, 2025 - **Analyst**: Richard Xu, CFA; Chiyao Huang; Chenqian Liu Core Insights 1. **M1 Growth**: There was a further pickup in M1 growth in September, reaching 7.2% year-over-year (YoY), compared to 6% in August, indicating improved liquidity and corporate sentiment despite moderating Total Social Financing (TSF) [3][8][10] 2. **Loan Growth Trends**: RMB loan growth moderated to 6.4% YoY from 6.6% the previous month, influenced by reduced window guidance and ongoing local government financing vehicle (LGFV) debt swaps [2][8] 3. **Corporate Loans**: Corporate loans remained the primary driver of loan growth, although there is a rationalization in industrial capital expenditure (capex) growth, leading to further moderation in medium- and long-term corporate loan growth [2][8] 4. **Government Bonds**: Government bonds added RMB 1.19 trillion in September, which is RMB 346 billion lower YoY, with a year-to-date (YTD) total of RMB 11.46 trillion [8][10] 5. **Corporate Deposits**: Corporate deposits grew by 4.2% YoY, with demand deposits rebounding to 6.7% YoY from 5.2% the previous month, indicating a recovery in corporate demand [3][8] Additional Important Points 1. **TSF Growth**: Headline TSF growth slowed to 8.7% YoY in September from 8.8% in August, reflecting a continued slowdown in loan growth and less support from government bonds [8][9] 2. **Household Loan Demand**: There was a modest pickup in long-term household loan growth, suggesting some recovery in mortgage loan demand, although overall household loan growth remains weak [2][8] 3. **Investment Sentiment**: The notably higher M1 growth is viewed as a positive sign indicating improved liquidity and corporate sentiment, which may help in moderating financial risks [3][8] 4. **Market Outlook**: The overall view of the China financials industry remains attractive, with expectations of continued recovery in financial metrics [5] Conclusion The conference call highlighted a mixed but cautiously optimistic outlook for the China financials sector, with signs of recovery in M1 growth and corporate deposits, while loan growth remains moderated due to tighter risk standards and reduced policy support. The industry is viewed as attractive, suggesting potential investment opportunities amidst the current economic landscape.

Summary of Key Points from the Conference Call Industry Overview - **Industry**: China Financials - **Date**: August 13, 2025 - **Analysts**: Richard Xu, CFA; Chiyao Huang; Beryl Yang; Chenqian Liu Core Insights 1. **Loan Growth Trends**: RMB loan growth moderated to **6.8% year-on-year (yoy)** in July, with a decline of **Rmb50 billion** in the month. This was supported by an increase in bills amounting to **Rmb871 billion**. Year-to-date (YTD) new corporate loans added **Rmb10.66 trillion**, down **1% yoy**. The slowdown is attributed to rationalization in industrial capital expenditure and local government financing vehicle (LGFV) swaps [2][9][10] 2. **Household Loans**: Household loans remained weak, particularly consumption loans, with YTD short-term household loans declining by **Rmb383 billion** compared to an increase of **Rmb61 billion** last year. This decline is partly due to banks adopting a more conservative risk appetite following higher retail loan non-performing loans (NPLs) in the previous year [2][9] 3. **Deposit Growth**: Household deposit growth decreased to **10.3% yoy** in July, with a monthly decline of **Rmb500 billion**. This decline is attributed to seasonal deposit flows to wealth management products (WMPs) and early signs of capital flow to equity markets. In contrast, corporate deposit growth accelerated to **4.1% yoy**, likely due to increased bond issuance and improved corporate cash flow [3][9] 4. **M1 and Corporate Deposits**: M1 growth rebounded to **5.6% yoy**, indicating a positive trend alongside the acceleration in corporate deposit growth. This combination is expected to help reduce corporate credit risks [4][9] 5. **Total Social Financing (TSF)**: Headline TSF increased by **9.0% yoy** in July, up from **8.9% in June**, supported by government bond issuance despite slower loan growth. Government bonds added **Rmb1.2 trillion** in July, with corporate bond growth recovering from a low base in 2024 [9][10] Additional Insights - **Market Dynamics**: The report indicates a shift towards more rational loan growth and a rebound in M1 and corporate deposit growth, which are seen as positive indicators for the financial stability of the sector [4][9] - **Investment Outlook**: The overall view of the China Financials sector is deemed attractive, suggesting potential investment opportunities amidst the current market conditions [5][63] Important Data Points - **RMB Loan Growth**: 6.8% yoy [2] - **Household Loan Decline**: Rmb383 billion YTD [2] - **Corporate Deposit Growth**: 4.1% yoy [3] - **M1 Growth**: 5.6% yoy [4] - **TSF Growth**: 9.0% yoy [9] This summary encapsulates the key points discussed in the conference call, highlighting the current trends and outlook for the China Financials sector.