CITIC Securities: No need to excessively worry about the impact of new regulations on perpetual bonds by public funds.

A research report from CITIC Securities pointed out that there have been narrow fluctuations in the bond market recently, with frequent public opinion incidents related to bank perpetual bonds. The market is concerned that institutional investors may adjust their liquidity management tools, redeem short-term bond products, leading to an increase in selling pressure on tradable varieties in the bond market and a significant adjustment in valuation. CITIC Securities believes that there is no need to overly worry about the impact of the new regulations on perpetual bonds for public funds: since 2024, under the rectification of net asset value for wealth management products, there has been a conflict between low volatility and high returns, and in 2026, wealth management institutions may increase their allocation of tradable varieties such as perpetual bonds and policy bank bonds in order to increase their returns. On the other hand, against the backdrop of a narrowing net interest margin for banks, rural commercial banks may increase their allocation of credit bonds, leading to a corresponding increase in actual demand for perpetual bonds. With the central bank restarting bond purchases, there is hope for a year-end rally to boost the bull market for medium to long-term credit bonds. 3-5 year national bank perpetual bonds have trading price advantages and investors can consider investing in them simultaneously with other varieties, advising to pay attention to the cost-effectiveness of bank perpetual bond allocations.