According to a research report released by China Construction Bank International, despite facing a complex operating environment, the Chinese banking industry still shows strong resilience in the first quarter of 2025. The report predicts that major banks' Net income will increase by about 1% year-on-year, reaching 454 billion yuan. Among them, the Net income growth rates for Bank Of Communications and China CITIC Bank Corporation are expected to be 4% and 3%, respectively. Industrial And Commercial Bank Of China has become the preferred stock in the current uncertain times due to its robust balance sheet and defensive fundamentals.

The report analysis states that the Chinese banking industry, through earlier structural reforms, has developed a stronger risk resistance ability, with the MSCI China Banking Industry Index recording a 2% increase this year, outperforming the global peers by 4 percentage points. Despite pressures from the narrowing Net interest margin and declining Trade income, factors such as balance sheet expansion, recovery of fee income, and improvement in asset quality will support profit growth. It is expected that the year-round Net income growth rate will gradually increase season by season, while the narrowing of the Net interest margin will gradually shrink.

At the individual stock level, Industrial And Commercial Bank Of China Listed in Hong Kong, with ample liquidity, strong impairment provisions, and capital adequacy ratio, offers the most reliable dividend returns. Large banks like China Construction Bank Corporation and CM BANK also demonstrate varying degrees of profit resilience. However, MINSHENG BANK and Ping An Bank may experience a slight decline in Net income, reflecting the impact of regional economic disparities on banking performance.

The report notes the need to pay attention to the potential impact of USA tariffs on certain industries, but believes that the overall risk in the Chinese banking industry is controllable. Currently, the sector's valuation is at a low level, with the average PB being below 1 time and the dividend yield generally above 5%, possessing defensive value in a volatile market. Jianyin International maintains a 'Neutral' rating for the sector and suggests focusing on large banks with stable dividends and ample capital.