The Zhitong Finance App learned that CITIC Securities released a research report saying that in 2027, the financial industry is at the intersection of the “15th Five-Year Plan” structural restructuring and valuation reshaping. On the one hand, the operating logic of the industry shifts from “scale expansion” to “structural restructuring and capacity improvement”; on the other hand, profit improvement resonates with undervaluation, and allocation value shifts from “game beta elasticity” to “receiving dividend returns.”
CITIC Securities's main views are as follows:
“Fifteenth Five-Year Plan” financial restructuring: the five major changes are reflected in each other.
In terms of the financing structure, direct financing accounts for nearly one-third of social finance stocks. The financial system has moved from being “bank-led” to “two-wheel drive in banks and capital markets”; the expansion of direct financing requires price signals to play a greater role. As a result, monetary policy has shifted from quantitative regulation to price regulation, and total financial volume has also returned from “target” to “observation”; the transformation of the regulatory framework is further reflected in the decline of M2 and loan growth, and “total volume deceleration and structural quality improvement” has become the new normal; at the same time, financial openness is driven by RMB internationalization as the main focus., investment of credit and capital towards technology and green A systematic gathering of “five major articles” on inclusion, pension, and digital “five major articles”.
Structural changes are transmitted to sub-industries: the direction is the same, and the path is different.
Banks are shifting from rapid growth to high-quality development, and the core profit statement is shifting to rebalancing “price” and “quality”; the insurance industry is repositioning to strengthen long-term risk management and patient capital supply functions; brokerage firms are shifting from financing channels to comprehensive services throughout the life cycle, and the ROE center is rising steadily. The three sub-sectors are changing in the same direction — profit quality is more important than scale elasticity, which also forms the basis for dividend attributes.
PB-ROE valuation system and dividend stratification: excellent profit, low valuation.
Over the past two years, bank ROE has been stable and insurance and brokers' ROE has improved, but PB valuations have been suppressed by market style and capital, and financial stocks as a whole are in a cost-effective range. According to profit certainty from high to low, dividends are clearly stratified: banks are traditional dividends, ROE steadily consolidates the dividend logic, with a dividend rate of about 3.9%, static PB of about 0.61x, long-term adaptation to low-wave stable funds; insurance is an extended dividend, leading insurers have sufficient capital. By the end of 1H26, the “old seven” core/comprehensive solvency adequacy ratio reached 140.0%/203.8%. The dividend rules are clear, and DPS growth is highly deterministic; the brokerage is a new dividend, and the dividend ratio converges to 30% — 40% — Leading brokerage firm A/H Shares predicts a dividend rate of about 4.4 in 2026 %/ 7.0%, the cash return value gradually became apparent.
Industry ranking: Preferred bonus banks, non-banks provide elasticity and alpha.
Based on the above framework, the industry ranking is “bank > non-bank”.
Preferred banks: Interest spreads have stabilized margins, asset quality expectations have bottomed out, and ROE growth has bottomed out. The ROE is expected to stabilize at 8% to 9% this year and next two years, and PB is expected to recover to 0.8-1 times; its dividend rate and dividend stability meet the allocation needs of long-term capital such as insurance capital, which is the ballast stone of the combination, and the seesaw effect with technology stocks means that both relative and absolute returns during the style change phase are worth looking forward to.
Second, African banks: brokerage firms are already at the bottom of dividend-supported valuations. In 2027, trading activity declined or performance was suppressed in stages, but direct investment earnings from technology IPOs, the second curve of internationalization of leading brokerage firms, and the construction of first-class investment banks will still provide upward flexibility; insurance is shifting from beta to interest-bearing alpha assets, and the three trends of declining debt costs, relaxation of capital constraints, and normalization of dividends have not been fully priced, and the return of valuations can be expected.
risk factors.
The macroeconomic growth rate declined sharply; capital market fluctuated sharply, A-share turnover declined; interest rates fluctuated sharply or credit risk exceeded expectations; regulatory policies changed beyond expectations; the quality of bank assets deteriorated beyond expectations; and insurance policy sales were sluggish.
Investment Strategy:
On the banking side, changes in the capital market narrative are a core factor. The sector is entering the end of the risk cycle and is expected to be revalued from “high dividend defense assets” to “high certainty equity assets”; in terms of insurance, leading insurers have sufficient capital and can be expected to pay dividends; in terms of securities, industry profits are expected to increase 30.3% year-on-year and ROE to reach 8.38% in 2026. The current A/H share PB is 1.20x/0.63x, which is 5./ 25.3% since 2016.