Guosheng: The long-term growth path of bank wealth management equity investment is clear, bringing value-added increments to the industry and sectors.

Guosheng released research report stating that promoting the reasonable increase of equity asset allocation ratio of bank wealth management funds is an important measure to implement the requirements for high-quality development of the capital market and to strengthen the growth of medium to long-term patient capital. Under the guidance of policies and proactive efforts of institutions, the long-term growth path of equity investment in bank wealth management has become clear. However, in the short term, it still faces objective challenges during the transition period of asset management. After overcoming related bottlenecks gradually, the bank wealth management industry is expected to embrace new opportunities for high-quality development. At the same time, it will inject more sustainable growth momentum into the banking sector. Guosheng's main points are as follows: Policy synergy empowerment A series of policies issued jointly by multiple departments have been put in place to break barriers and expand the space for equity investment in bank wealth management. From various dimensions such as market access, assessment mechanisms, and investment channels, these policies provide systematic institutional support for equity investment in bank wealth management, continuously optimizing the industry's development ecology. In September 2024, the Central Financial Office and the China Securities Regulatory Commission jointly issued the "Guiding Opinions on Promoting the Entry of Medium to Long-term Funds into the Market," clearly encouraging bank wealth management to actively participate in the construction of the capital market, putting forward the core orientation of "optimizing incentive assessment mechanisms, smoothing market entry channels, and increasing equity investment scale," setting the tone for the industry's transformation towards equity investment. In January 2025, six ministries jointly issued the "Implementation Plan on Promoting the Entry of Medium to Long-term Funds into the Market," which achieved key breakthroughs on the basis of previous policies, explicitly stating that bank wealth management would enjoy the same policy treatment as public funds in terms of new stock subscription, listed companies' targeted issuance, and takeover identification criteria. This measure effectively eliminates differentiated barriers in market access and greatly enhances the willingness and feasibility of bank wealth management to participate in the equity market. Transition challenges The phase-specific challenges and causes of equity allocation in bank wealth management currently faced by the industry in the process of advancing equity asset allocation are mainly due to the structural linkage characteristics of the industry's transformation after the implementation of the new asset management regulations, primarily reflected in customer awareness adaptation and fund term matching. On one hand, the "Administrative Measures for Commercial Bank Wealth Management Business" explicitly require that after the implementation of the new asset management regulations, bank wealth management will fully switch to net asset value management, and equity assets must be strictly valued using the market value method, with asset price fluctuations directly reflected in the product's net asset value. This compliance requirement conflicts with the transitional adaptation of some clients' traditional wealth management cognition: the long-running fund pool model in the industry has led some clients to form an inherent expectation of "stable and value-increasing wealth management with low volatility," even confusing it with the risk attributes of deposit-like products, resulting in a low acceptance of normal net asset value fluctuations. This cognitive bias needs to be gradually resolved through continuous investor education and market-oriented guidance. On the other hand, the natural contradiction between liquidity management and asset attributes, as well as the dual constraints of risk control and performance evaluation, further compress the space for equity allocation. Daily open-ended wealth management products need to strictly follow liquidity management requirements, with some wealth management funds having short-term terms being a natural mismatch with the core attribute of equity assets for "long-term holding and growth." At the same time, from the perspective of risk control, some products are restricted by asset access policies and are unable to diversify risks and increase yields through a diversified asset portfolio, coupled with short-term performance evaluation pressures, leading institutions to remain cautious in equity asset allocation. Industry value enhancement For both the banking sector and the wealth management industry, enhancing the capability of equity asset allocation in wealth management business is not only a necessary measure to respond to policy calls and implement the requirements of entering medium to long-term funds into the market, but also a core lever to break away from the reliance on fixed-income business and achieve an upgrade in wealth management business, bringing incremental value to the industry and sector. In the short term, "fixed income + equity" products have become the core focus for the transition phase, which can increase product yields while controlling net asset value fluctuations, effectively increasing client stickiness. It also aligns with the trend of residents' wealth shifting "from deposits to diversified assets," helping banks seize market share in wealth management. In the long term, as the equity allocation ratio of bank wealth management steadily increases and the research and investment capabilities continue to strengthen, it will drive banks to transition from "traditional fixed-income asset managers" to "comprehensive wealth service providers," establishing a business layout driven by both "fixed income + equity." This will break through the valuation bottleneck of traditional businesses, opening up new valuation space for the banking sector. Currently, as policy dividends continue to be released and the capital market ecology continues to improve, bank wealth management equity investment is in a strategic period of opportunity. With investors' understanding deepening gradually and institutions' research capabilities and product innovation improving continuously, bank wealth management is expected to gradually grow into important "patient capital" in the capital market. It will provide long-term funding support for the stable and healthy development of the capital market, injecting more sustainable momentum for high-quality development into the banking sector. Data tracking Equity market tracking: 1) Trading volume: The average daily turnover of stocks this week was 3.465285 trillion yuan, an increase of 613.162 billion yuan compared to last week. 2) Margin trading: The balance was 2.71 trillion yuan, an increase of 3.73% compared to last week. 3) Fund issuance: Non-monetary fund issuance this week was 19.294 billion yuan, an increase of 11.103 billion yuan compared to last week. Since January, a total of 27.485 billion yuan has been issued, a decrease of 55.780 billion yuan year-on-year. Among them, equity funds were 9.118 billion yuan, a decrease of 15.929 billion yuan year-on-year; hybrid funds were 4.994 billion yuan, an increase of 1.724 billion yuan year-on-year. Interest rate market tracking: 1) Interbank certificates of deposit: A. Volume: According to Wind data, the issuance scale of interbank certificates of deposit this week was 552.88 billion yuan, an increase of 377.82 billion yuan compared to last week; the current balance of interbank certificates of deposit was 19.23 trillion yuan, a decrease of 449.68 billion yuan compared to the end of December. B. Price: The issuance interest rate of interbank certificates of deposit this week was 1.65%, an increase of 2 basis points compared to last week; the issuance interest rate in January was 1.64%, a decrease of 1 basis point compared to December. 2) Bill rates: The average discount rate for half-year state-owned large and joint-stock bank bills this week was 1.14%, a decrease of 10 basis points compared to last week; the average rate in January was 1.19%, an increase of 34 basis points compared to December. The average discount rate for half-year city commercial bank bill discounts this week was 1.30%, a decrease of 10 basis points compared to last week; the average rate in January was 1.35%, an increase of 34 basis points compared to December. 3) 10-year treasury bond yield: The average 10-year treasury bond yield this week was 1.85%, a decrease of 3 basis points compared to last week. 4) Local government special bond issuance scale: New special bonds issued this week amounted to 22.756 billion yuan, a decrease of 64.678 billion yuan compared to last week, with a cumulative issuance of 110.19 billion yuan since the beginning of the year. 5) Special refinancing bond issuance progress: New special refinancing bonds issued this week amounted to 38.876 billion yuan, with an average interest rate of 2.45%, and a cumulative issuance of 68.106 billion yuan since the beginning of the year. Risk warning 1) Risk of deteriorating bank asset quality; 2) Risk of consumer growth falling short of expectations; 3) Risk of exports declining more than expected.