China Merchants Bank (3968) Q3 2025 earnings summary

Executive summary

• Net operating income for the first three quarters was CNY 251.28 billion, down 0.52% year-over-year, with the decline narrowing from the first half.

• Net profit attributable to shareholders reached CNY 113.772 billion, up 0.52% year-over-year, with improved growth compared to the first half.

• ROAA and ROAE were 1.22% and 13.96%, both slightly up from the first half but down year-over-year.

• Asset quality remained stable, with NPL ratio at 0.94%, down 0.01 percentage point from year-end.

• Total assets reached CNY 12.64 trillion, up 4.05% from year-end; total loans and advances increased 3.6%.

Financial highlights

• Net interest income grew 1.74% to CNY 160.042 billion; NIM was 1.87%, down 12 bps year-over-year but decline narrowed.

• Net fee and commission income rose 0.90% to CNY 56.202 billion; wealth management fee and commission income rose 18% to CNY 20.67 billion.

• Customer deposits rose 4.64% to CNY 9.52 trillion, with demand deposits at 49.45% of the total.

• Operating expenses increased 0.80% to CNY 82.833 billion; cost-to-income ratio was 29.86%.

• Expected credit losses decreased 8.24% to CNY 33.351 billion.

Outlook and guidance

• Retail loans remain a strategic focus despite weak demand; corporate loan growth aligns with government guidance.

• NIM expected to stabilize at a lower level, with further decline limited by already low liability costs.

• Fee income growth expected to continue, though mutual fund fee cuts may pressure income from 2026.

• Asset quality to remain stable, with close monitoring of real estate and retail loan risks and proactive risk management.

• Capital management to remain precise, with CAR and Tier 1 ratios expected to stay at leading levels.