China Merchants Bank (3968) Q4 2024 earnings summary

Executive summary

• Achieved steady growth in 2024 despite a complex environment, with net profit attributable to shareholders rising 1.22% to RMB 148.39 billion and ROAE at 14.49%.

• Total assets surpassed RMB 12 trillion, up over 10%, and customer deposits exceeded RMB 9 trillion, up over 11%.

• Maintained strong asset quality with NPL ratio at 0.95% and allowance coverage ratio at 411.98%.

• Retail finance contributed over half of net operating income and profit before tax, with retail AUM nearing RMB 15 trillion and over 200 million customers.

• Significant investment in technology and ESG, with RMB 13.35 billion spent on IT, over 10,000 R&D staff, and MSCI ESG rating upgraded to AAA.

Financial highlights

• Net operating income: RMB 339.08 billion (up 0.58% year-over-year); net profit attributable to shareholders: RMB 148.39 billion (up 1.22%).

• NIM: 1.98% (down 17 bps year-over-year), still leading peers.

• Net non-interest income grew 1.15% to RMB 125.84 billion, now 37.33% of revenue.

• Cost-to-income ratio: 31.92% (down 1.05 percentage points), reflecting improved efficiency.

• Total loans and advances: RMB 6.89 trillion (up 5.83%); total deposits: RMB 9.10 trillion (up 11.54%).

Outlook and guidance

• 2025 will bring both opportunities and challenges, with macro policies expected to be more proactive and supportive.

• NIM contraction expected to continue, but at a slower pace; loan growth budgeted at 7–8%, subject to external conditions.

• Focus on innovation, technology leadership, risk management, and internationalization to sustain growth.