China Merchants Bank (3968) Q4 2025 earnings summary

Executive summary

• Achieved dual growth in revenue and net profit for 2025, with net operating income at RMB 337.2 billion (up 0.05%) and net profit attributable to shareholders at RMB 150.2 billion (up 1.21%), both reaching record highs despite a challenging macroeconomic environment.

• Maintained industry-leading ROAA (1.19%) and ROAE (13.44%), despite slight year-on-year declines.

• Retail Finance contributed over half of net operating income and pre-tax profit, with retail AUM exceeding RMB 17 trillion (up 14.44%).

• Continued strategic transformation, with significant improvements in digitalization, risk management, and international operations.

• MSCI ESG rating remained at AAA for two consecutive years, reflecting strong ESG performance.

Financial highlights

• Net interest income rose 2.04% to RMB 215.6 billion; NIM was 1.87%, down 11bps year-on-year but stabilized in Q4.

• Non-interest income fell 3.31% to RMB 21.7 billion, but net fee and commission income grew 4.39%.

• Total assets surpassed RMB 13 trillion; total loans and advances reached RMB 7.26 trillion (up 5.37%), and customer deposits RMB 9.84 trillion (up 8.13%).

• Basic EPS: RMB 5.70, up 0.71% year-on-year.

• Cost-to-income ratio: 32.01%, up 0.09 percentage points year-on-year.

Outlook and guidance

• Expects continued pressure on NIM and profitability in 2026, but aims for smaller NIM decline and stable growth.

• ROE expected to remain above 10%, with 10% seen as a bottom.

• Targeting 6–7% growth in both total deposits and total loans for 2026.

• Focus on value creation, digital transformation, risk management, and international expansion.

• Continued focus on technology finance, green finance, inclusive finance, retirement finance, and digital finance.