New "Universe Bank" is born! Agricultural Bank's stock price hits a new high, total market value surpasses ICBC for the first time.

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Agricultural Bank of China’s share price hit another record high on Thursday, pushing its combined A+H share market capitalization to surpass Industrial and Commercial Bank of China for the first time, making it China’s new “bank of the universe.” This historic change marks the phased achievement of the valuation repair and fund allocation logic in the banking sector, as well as the market’s renewed assessment of the "low valuation + high dividend" value of bank shares.

On September 4, Agricultural Bank of China’s A shares once reached a historic high of 7.55 yuan/share intraday, closing at 7.52 yuan/share, up 5.17%. Its H shares closed at 5.4 Hong Kong dollars/share, up 1.5%. Wind data shows that calculated by A+H combined market capitalization, Agricultural Bank’s total market value stands at 2.55 trillion yuan, surpassing ICBC for the first time; the latter now has a market capitalization of 2.49 trillion yuan. Previously, on August 6, Agricultural Bank’s A share market value had already exceeded ICBC, taking the top spot in A shares for the first time.

Agricultural Bank’s share price gain this year has significantly outperformed ICBC, combined with steady performance growth and improved asset quality, attracting a large influx of risk-averse capital. Multiple brokerages and investment banks believe that the banking sector’s fundamentals have entered a stable period, and changes in policy and liquidity will continue to affect subsequent performance.

Market Cap Surpasses ICBC for the First Time

Both Agricultural Bank of China and ICBC are dual-listed on A and H shares. This market cap calculation uses the “comprehensive statistical method,” which separately tallies the amount and price of A and H shares, then sums the resulting market values. The specific formula is as follows:

Total Market Cap = A Share Price × Number of A Shares + H Share Price (converted to RMB) × Number of H Shares

As of the closing data on September 4, Wind data shows Agricultural Bank of China has about 350 billion shares in total, with A shares accounted for 91.22% and H shares 8.78%. ICBC has around 356.4 billion shares outstanding, with 75.65% in A shares and 24.35% in H shares. The closing prices of A and H shares on the day are multiplied by the respective share counts, then H share prices are converted to RMB before summing, resulting in Agricultural Bank’s total A+H market value of about 2.55 trillion yuan, surpassing ICBC’s 2.49 trillion yuan for the first time.

However, if calculated by total shares outstanding * current price, Agricultural Bank’s market value is 2.63 trillion yuan, still slightly lower than ICBC’s 2.69 trillion yuan.

Since the start of this year, the banking sector as a whole has strengthened, with Agricultural Bank standing out. Wind data shows that so far this year, Agricultural Bank’s A shares have risen more than 44%, H shares up over 30%; during the same period, ICBC A shares rose over 13%, H shares more than 17%. A shares are trading at a significant premium over H shares, reflecting increased preferences of Mainland investors for bank stocks.

On August 6, Agricultural Bank’s A share market value surpassed ICBC for the first time, taking the top spot in A-share market capitalization. Less than a month later, the total A+H market value also surpassed ICBC, showing continued investor favor for Agricultural Bank.

Stable Performance and Asset Quality

Industry insiders point out that Agricultural Bank’s market cap breakthrough is not accidental, but a recognition from the market of its stable profitability, high dividend yield, and advantages in rural economic penetration.

In the first half of the year, Agricultural Bank achieved a net profit attributable to the parent company shareholders of 139.51 billion yuan, up 2.66% year-on-year; operating revenue was 369.937 billion yuan, up 0.85% year-on-year. Over the same period, ICBC’s net profit was 168.103 billion yuan, down 1.39% year-on-year; operating revenue was 427.092 billion yuan, up 1.6% year-on-year.

In terms of asset quality, Agricultural Bank’s non-performing loan ratio dropped to 1.28%, the special-mentioned loan ratio was 1.39%, overdue loan ratio remained at a low 1.22%, and the provision coverage ratio reached as high as 295%. Solid asset quality and ample provision ensure growth in results.

According to a previous article by Securities Times, Tian Lihui, dean of the Institute of Financial Development at Nankai University, pointed out that Agricultural Bank’s rise to the top reflects a market shift from chasing high growth to seeking certain return, and the high dividend yield of bank stocks becoming significantly more attractive in a declining interest rate environment. In the short term, the valuation recovery of bank stocks is likely to continue, while long-term performance depends on economic recovery and interest rate trends.

A previous report by Goldman Sachs also believes that Chinese bank stocks have reached a turning point, predicting that H share income and net profits of domestic banks will continue to improve from 2025 to 2027. CITIC Securities, Galaxy Securities, and other institutions have also stated that the core business fundamentals of the banking industry are solid, the policy environment is favorable, and the sector's fundamentals have entered a stable period. Going forward, changes in liquidity and macro policy expectations will become key variables affecting bank stocks, with the overall investment outlook being optimistic.

Risk Warning and DisclaimerThe market is risky; investment needs caution. This article does not constitute personal investment advice and has not considered any individual user’s particular investment objectives, financial situation, or needs. Users should consider whether any opinions, viewpoints, or conclusions in this article are suitable for their specific circumstances. Any investments made accordingly are at one's own risk. ```