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Don’t bet against the banks as trade war abates

Goola Warden
Goola Warden • 9 min read
Don’t bet against the banks as trade war abates
The local banks may face some headwinds, but stress tests show they are more than ready; and they have reiterated commitment to their ordinary dividends and capital management
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Investors looking for long-term appreciation and dividends need look no further than the local banks.

Following the announcement that the US had “blinked” and agreed to roll back most of its 145% tariffs on China down to 30% for 90 days, and for China to reciprocate with 10% tariffs on US imports compared to 125%, the share prices of the three banks jumped on May 13.

Their share prices are likely to continue to be supported by generous dividends. One of the reasons investors are willing to wade back into the banks is because of trade. All three banks have a trade finance business and have received awards for trade and supply chain financing.

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