BEIJING, Dec. 7 (Xinhua) – Banking stocks in China are expected to post optimistic performance in 2021, reported Xinhua Finance, a Xinhua-run financial information platform on Monday.
The report quoting a research report released by analysts with China Securities said the main theme of the trending in banking industry in China for 2021 will be addressing existing risks and regaining profit.
For one thing, addressing existing risks is good for the upward revision of overall valuation of banking sector and for another, regaining of profit is likely to significantly improve the return on equity (ROE) and shore up valuation of banking shares.
Regarding the timing, analysts with China Securities are more optimistic about performance of banking sector stocks after the first quarter of the coming year, and forecast that banks may see their net profit pick up by quarters gradually and ROE start to rebound.
Among banks of various types, the research report suggested attention to joint stock commercial banks as they are pouring unprecedented efforts into handling exiting risks, which creates more room for their valuation revision. (Edited by Duan Jing with Xinhua Silk Road, duanjing@xinhua.org)
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