Postal Savings Bank of China: Agency Fee Cut Is Mildly Positive for Earnings; We Maintain Valuation

We maintain our fair value estimates for Postal Savings Bank of China, or PSBC, at CNY 5.7 per A share and HKD 6.5 per H share, following recent adjustments to deposit agency fee rates. PSBC compensates its parent company, China Post Group, for deposits acquired through postal agency outlets, which account for over 60% of total deposits. The bank also announced an interim dividend of CNY 0.1477 per share to be paid in January 2025. The 30% payout ratio aligns with state-owned peers, and we anticipate that PSBC’s total dividend per share for 2024 will remain largely unchanged from 2023, given our forecast of a 0.4% increase in net profit.