CCB Maintains a Steady Credit Quality and Higher Coverage Ratio Despite Challenging Headwinds

China Construction Bank's strong deposit franchise and high-quality customer base differentiate it from peers, as it leverages its extensive offline network and strong ties with household and corporate customers. However, its deposit strength is overshadowed by ongoing industry headwinds, including slowing deposit growth and ongoing deposit migration to time deposits during the falling rate cycle. We expect CCB's net interest margin should outperform when business activities recover.