The dividend yield of many bank stocks is higher than the yield of bank wealth management products

  Is it better to buy bank stocks than to buy bank wealth management products?

  With the successive disclosure of the 2021 annual reports of listed banks, their performance has gradually emerged.

According to the data, 24 listed banks have disclosed their 2021 annual performance reports, 22 have achieved a year-on-year increase in operating income, and 23 have achieved a year-on-year increase in net profit attributable to shareholders of the parent company.

  However, the reporter noticed that the dividend yield of many bank stocks is higher than the yield of bank wealth management products, and the dividend yield of 7 bank stocks exceeds 6%.

When bank wealth management products frequently break net, is it better to buy bank stocks than to buy bank wealth management products?

What should investment banks pay attention to?

  Text, watch/Wang Chuhan, all media reporter of Guangzhou Daily

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  Bank stock breakouts are still widespread

  According to the data of Oriental Fortune Choice, as of March 20, 24 listed banks have disclosed their 2021 annual performance reports, and the overall performance is outstanding.

In terms of total operating income, except for Xiamen Bank and Shanghai Pudong Development Bank, all the other 22 listed banks achieved year-on-year growth.

From the perspective of net profit attributable to shareholders of the parent company, except for Shanghai Pudong Development Bank, the other 23 listed banks have achieved year-on-year growth.

  However, bank share breakouts are still widespread.

According to data from Oriental Wealth Choice, as of March 20, there were 35 banks whose stock market net ratio was less than 1, accounting for more than 80%.

Among them, 10 banks including Minsheng Bank, Hua Xia Bank, Shanghai Pudong Development Bank and other 10 banks have a net stock market ratio of less than 0.5 times.

  "At present, many bank stocks have broken net mainly due to the increasing downward pressure on the economy. The market's expectations for bank operating performance have weakened, and the sector's valuation has declined." Luo Zhiheng, chief economist of Yuekai Securities, analyzed that on the one hand, Mortgage loans are relatively high-quality assets of banks. Recently, the central government and local governments have successively introduced active and loose policies to stabilize real estate and expectations. Mortgage loan interest rates have been lowered, but real estate sales have not stabilized. The decline will affect the bank's profitability.

On the other hand, in the context of increasing downward pressure on the economy, the non-performing asset ratio of banks may rise, which will further erode bank profits.

  "Considering the current low valuation of the banking sector as a whole, and the policy orientation of steady growth and lenient credit in the future, we can focus on city commercial banks with better regional economies, advantages in infrastructure investment, and high profitability." Luo Zhiheng analyzed.

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  Holding bank stocks also needs to consider factors such as timing, taxes and fees

  Although bank stocks frequently "break the net", the reporter observed that the dividend rate of many bank stocks is higher than the yield of bank wealth management products.

If the dividend distribution plan of listed banks is the same as in 2020, data from Oriental Fortune Choice shows that as of March 20, 7 bank stocks have a dividend yield of over 6%, and 22 bank stocks have a dividend yield of over 4%.

At the same time, according to the latest data from Puyi Standard, in February, the performance of 50 selected mid- and low-risk six-month investment cycle products in the national bank wealth management market declined compared with the previous month. 2.04%, down 8BP from January 2022.

  Is it better to buy bank stocks than to buy bank wealth management?

At the press conference held by the State Council Information Office to promote a virtuous circle of economic and financial development and high-quality development, Tian Guoli, chairman of China Construction Bank, mentioned that from the perspective of ups and downs, big bank stocks are not suitable for short-term, but in the long run , the dividend rate is much higher than that of wealth management products, and there are opportunities to make profits after holding them.

  Luo Zhiheng said that from a theoretical point of view, against the backdrop of bank wealth management breaking the rigid exchange rate and the declining wealth management yield level, the dividend rate of bank stocks is relatively high and the investment attractiveness has increased.

"But you can't simply and directly compare the bank's wealth management yield and the dividend rate of bank stocks. When holding bank stocks, you also need to consider factors such as timing, taxes and fees." Luo Zhiheng reminded.

  Specifically, Luo Zhiheng analyzed that first, stock prices are usually volatile, and it is not meaningful to use bank stocks instead of bank financial management for short-term investment. The downside risk of bank stock prices may cause bank stock prices to fall by more than 5%.

Second, if the holding period is short, the dividends of bank shares are subject to personal income tax, while the wealth management income of banks is not subject to personal income tax.

In order to avoid short-term speculation and speculation, the policy stipulates that dividends and dividends obtained with a holding period of less than 12 months need to be levied at a rate of 20% for personal income tax.

Specifically, if the shareholding period is less than 1 month (including 1 month), the full amount of dividends and dividends will be included in the taxable income; if the shareholding period is more than 1 month to 1 year (including 1 year) , temporarily included in the taxable income at 50%; more than 1 year, temporarily exempt from personal income tax.

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  More than 1,000 bank wealth management products broke the net

  It is worth noting that, with the full implementation of the new regulations on asset management, banks continue to make efforts in wealth management business. However, among the more than 10,000 wealth management products currently issued by the bank's wealth management subsidiaries, more than 1,000 products have a unit net value of less than 1. Yuan.

"In the past two years, wealth management companies have increased their equity investment, and the recent stock market volatility has led to a decline in the net value of some wealth management products that allocate equity assets, or even below the initial net value." Analyst Liu Yinping of Rong360 Digital Technology Research Institute analyzed the proportion of equity asset allocation. The larger the value, the greater the fluctuation of the net value of wealth management products, which also shows that after the transformation of wealth management products to net value, the rigid payment has indeed been broken, and investors must be responsible for their own profits and losses.

  The reporter noticed that a number of bank wealth management companies such as Huaxia Wealth Management and SPDB Wealth Management have issued announcements one after another, and it is necessary to rationally view the fluctuation of the net value of products under the volatile market.

Bank wealth management products broke out frequently, and the market was also worried about the redemption of wealth management products, triggering passive selling and forming a negative feedback effect in the stock and bond markets.

"It is not expected to trigger a large number of redemptions." Liu Yinping said that most of the financial products with large net value declines are medium and high-risk financial products. Investors have a certain risk tolerance, most of the products have a small withdrawal range, and financial products are closed to a certain extent. In the medium and long term, the proportion of products that actually suffer losses is very low.

However, wealth management companies should learn from this round of "breaking the net" and may be more cautious in equity investment in the future.

  Liu Yinping suggested that, generally speaking, wealth management products with low-to-medium risk, fixed income, unallocated equity assets, small fluctuations in historical net worth, or the same series of products with small fluctuations in historical net worth have relatively high income stability, and the performance of such products is relatively high. The benchmark for comparison is also low.

If investors want to pursue higher financial returns, they must bear the corresponding risks.

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