Since July’s style rotation the Chinese bank sector has rebounded, delivering positive absolute and relative returns. Public mutual fund holdings rose 0.92 percentage points to 1.93%, the highest since 3Q2025. CITIC Securities cites a convergence of style rotation, improved liquidity/flow conditions and stable operating expectations. Near term the sector may see increased volatility from flows; mid term it should be driven by fundamentals and allocation demand. CITIC expects the sector to be re‑

Since July’s style rotation the Chinese bank sector has rebounded, delivering positive absolute and relative returns. Public mutual fund holdings rose 0.92 percentage points to 1.93%, the highest since 3Q2025. CITIC Securities cites a convergence of style rotation, improved liquidity/flow conditions and stable operating expectations. Near term the sector may see increased volatility from flows; mid term it should be driven by fundamentals and allocation demand. CITIC expects the sector to be re‑rated from a high‑dividend defensive asset to a high‑certainty equity and forecasts upward valuation pressure through the year.