China Regional Banks 3Q26 preview: Core earnings growth to moderate; AQ to drive further earnings differentiation

China regional banks (CRBs) under our coverage will begin reporting 3Q26 results since October 20. We expect average net profit growth across the covered CRBs to moderate to 7% y/y in 3Q26 from 8% y/y in 2Q. Average PPOP growth should remain steady at 9% y/y, with a slightly moderated trend in core earnings offset by a smaller drag from non-fee income. Asset quality and provisioning needs should remain the key drivers of earnings differentiation, with retail risk stabilizing at BoNB, BoNJ and CRCB, while tighter NPL recognition could weigh on BoSH. We see potential upside surprises at BoNB and CRCB, supported by BoNB's stronger-than-peers core earnings momentum and CRCB's improving profit growth trajectory. BoSH faces a larger downside earnings risk from elevated provisioning needs, although its higher dividend yield (5.5% in 2026E) could provide some downside support to the share price.