BofA Securities has maintained its earnings forecast for China Construction Bank (CCB) (00939) but downgraded its H-share rating from "Buy" to "Neutral," citing the stock's strong year-to-date performance (up ~30%) as already reflecting its defensive growth advantages. The target price remains unchanged at HK$8.17.

For CCB's A-shares (601939.SH), BofA retains a "Buy" rating with a target price of RMB 9.77, citing its relatively high dividend yield among A-share peers.

CCB reported a 0.6% YoY increase in net profit for the first three quarters to RMB 257.4 billion, reversing a 1.4% decline in the first half, aligning with the recovery trend seen among state-owned peers. However, diluted EPS saw a slight YoY decline due to equity dilution. Core earnings growth slowed to 1% YoY in the first three quarters (from 3.6% in H1), achieving 82% of BofA's full-year 2025 forecast. Annualized ROE fell 0.8 percentage points YoY to 10.3%, while the core Tier 1 capital ratio remained robust at 14.4%.

The report noted mixed Q3 trends, with CCB's net interest margin (NIM) declining 8bps QoQ to 1.3%, underperforming peers. Net interest income dropped 2.7% QoQ, contrasting with industry-wide growth driven by lower funding costs.