Bank financial income is not as good as bank stocks?
Recently, bank stocks have rebounded. Last week, the China Citic Bank Corporation Limited(601998) index rose by more than 7% in two trading days, and the dividend yield of seven banks exceeded 6% based on the current share price.
In addition, according to the latest financial statements of Ping An Bank Co.Ltd(000001) and China Merchants Bank Co.Ltd(600036) for 2021, Ping An Bank Co.Ltd(000001) pays cash dividends of RMB 2.28 (including tax) for every 10 shares China Merchants Bank Co.Ltd(600036) intends to pay a cash dividend of 1.522 yuan per share. According to the latest closing price, the dividend yield during the reporting period was 1.55% and 3.29% respectively, 27 percentage points and 21 percentage points higher than that in 2020.
However, with the advent of the era of true net worth, bank financial products have “broken net” in a large area. Especially since this year, the A-share market has experienced a sharp correction, and the net value of fixed income + equity products in bank financial products has retreated significantly. In contrast, it seems that the income of bank stocks is much higher than that of bank deposits and financial products.
Tao Jin, deputy director of the macroeconomic research center of Suning Financial Research Institute, believes that investors’ awareness of risk appetite is particularly important under the severe fluctuation of market conditions. He suggested that financial product providers such as banks need to set up the same additional product risk tips and stricter investor risk assessment as other types of products such as funds. Investors need to systematically read and understand the investment orientation, configuration direction and other contract provisions of financial products, and carefully study and select financial products.
bank stock dividend yield rises
Undervaluation and net breaking are the “norm” of bank stocks. However, industry insiders believe that under the current valuation level, if the dividend plan of listed banks remains unchanged in 2021, the dividend yield of bank stocks is expected to increase.
According to the statistics of Tonglian data, based on the latest closing price, 35 of the 42 bank stocks of A-Shares have a price to book ratio of less than 1, accounting for more than 80%. Another 10 have a price to book ratio lower than 0.5, including Chongqing Rural Commercial Bank Co.Ltd(601077) , Bank Of Beijing Co.Ltd(601169) , Bank Of Guiyang Co.Ltd(601997) , China Minsheng Banking Corp.Ltd(600016) , Hua Xia Bank Co.Limited(600015) , Shanghai Pudong Development Bank Co.Ltd(600000) , Bank Of China Limited(601988) and Bank Of Communications Co.Ltd(601328) .
Recently, Ping An Bank Co.Ltd(000001) , China Merchants Bank Co.Ltd(600036) released the annual report of 2021. During the reporting period, China Merchants Bank Co.Ltd(600036) dividend yield was 3.29%, higher than 2.71% in 2020 Ping An Bank Co.Ltd(000001) 2021 dividend yield was 1.55%, higher than 1.22% in 2020.
In addition, based on the current stock price, the dividend rate of seven banks has exceeded 6%, which is much higher than the annual yield of deposits and financial products. The dividend yield of Bank Of Beijing Co.Ltd(601169) is the highest, reaching 6.78%, and the dividend yield of Bank Of Communications Co.Ltd(601328) , China Everbright Bank Company Limited Co.Ltd(601818) , Bank Of China Limited(601988) , Agricultural Bank Of China Limited(601288) , Shanghai Pudong Development Bank Co.Ltd(600000) , Bank Of Shanghai Co.Ltd(601229) is also higher than 6%.
“Large bank stocks are not suitable for short-term. In the long run, the dividend rate has been far higher than financial products. At the same time, there are opportunities for profit after holding them.” Earlier, Tian Guoli, chairman of China China Construction Bank Corporation(601939) said.
Some market participants believe that although the dividend yield of bank shares is higher than that of most financial products, the short-term share price increase of bank shares may be higher than the dividend yield. Investors can choose their own investment strategy according to their own risk appetite. According to the statistics of Tonglian, the share prices of 14 A-share listed banks have risen since the beginning of the year, and the cumulative increase of Bank Of Chengdu Co.Ltd(601838) , Bank of Lanzhou has exceeded 10%.
Citic Securities Company Limited(600030) research report continues to be optimistic about the performance of bank stocks in the next stage. It is expected that monetary, credit, regulatory, real estate and other policies in the next stage are expected to form a joint force of stable growth and stable expectation. For the banking sector, Citic Securities Company Limited(600030) believes that the stock liquidity pressure from the outflow of foreign capital to the redemption of funds such as China’s financial management is gradually alleviated, and the stock price fully reflects the expected impact of real estate risk caused by poor financial data, waiting for the policy to improve the expectation of asset quality.
bank financial management broke the net in a large area
In the past two months, with the sharp adjustment of the stock and bond market, the yield of bank financial products has also changed significantly.
According to statistics, up to now, among the more than 28000 bank financial products in the whole market (including those issued by banks and bank financial subsidiaries), more than 2000 products have broken the net.
The transition period of the new regulations on asset management has ended, financial management companies have become the main body of the development of financial management business, and bank financial management has gradually become a public fund, entering the era of true net worth According to the statistical analysis of China Merchants Securities Co.Ltd(600999) bank team, the 7-day annualized yield of cash management financial management decreased slightly in recent month; Due to the adjustment of the bond market, the average half month annualized yield of net fixed income and fixed income + financial management was negative in the first half of March; The recent stock bond adjustment has also made the yield of mixed and equity financial management generally poor since the beginning of the year.
Especially due to the sharp decline of the stock market, the net value of mixed and equity financial management retreated significantly in the first quarter, and there were many net breaking products.
China Merchants Securities Co.Ltd(600999) research report shows that as of March 15, the average year to date yield of mixed financial products of wealth management companies is about – 2.03%, and the number of mixed financial products accounts for 41%; The average rate of return of the 20 equity financial products that exist in financial management companies since the beginning of the year is only – 10.38%, and the number of net breaking products accounts for 60%. The negative feedback of equity financing is obvious, and the stock products encounter the pressure of customer redemption.
For the large net value withdrawal of fixed income + and equity products of the banking system, an industry person of a bank financial management subsidiary told reporters that such products refer to a kind of products with fixed income assets as the bottom position, supplemented by equity assets and alternative assets. At present, there is no clear product definition in the market. Taking four products that have been established for more than half a year and whose equity position is less than 20% as an example, the total number of related products is 105.
According to the specific analysis of the above-mentioned persons, the recent stock market correction has a great impact on the product income. In terms of annualized income indicators, 105 products have an average annualized rate of 0.1% in recent half a year and 2.77% in recent one year. From the perspective of the maximum pullback index, the average maximum pullback of 105 products in recent one year is 1.25%, including – 0.73% for Xinyin wealth management, – 0.87% for CMB wealth management, – 1.25% for Everbright wealth management and – 2.53% for xingyin wealth management.
China Merchants Securities Co.Ltd(600999) bank team believes that with the sharp increase in the valuation proportion of bank financial management market value method, the fluctuation of net value increases, the difficulty of people’s financial investment increases, and it is not low to achieve better financial investment income.
China Securities Co.Ltd(601066) securities analyst Ma Kunpeng believes that although the net breaking ratio of bank financial products is increasing, the redemption pressure of products will not be too great. Compared with the products with similar assets, the overall performance of bank financial management is relatively stable and the withdrawal range is relatively small. And financial products are absolute income products. As medium and long-term investment products, the rate of return is relatively stable.
In addition, for the bank’s financial management subsidiaries, “providing customers with more diversified configuration strategies and product options is the general trend”. The relevant person in charge of credit bank financial management told reporters that with the end of the transition period of the new asset management regulations, financial products have entered the era of net worth. In the short term, fixed income products will still be the main products for some time in the future. However, as customers gradually adapt to fluctuations, they will put forward higher requirements for product revenue.
