常熟银行(601128) - 2025 Q2 - 季度财报

About Us Provides essential company information, including key disclaimers, definitions, corporate profile, and a summary of financial performance and key indicators Important Notice The board, supervisory board, and senior management guarantee the report's accuracy, confirm it's unaudited, and propose a cash dividend of RMB 1.50 per 10 shares for H1 2025 - Company's board of directors, supervisory board, and senior management guarantee the truthfulness, accuracy, and completeness of the report's content[16] - This semi-annual report is unaudited[18] - A cash dividend of RMB 1.50 (tax inclusive) per 10 shares is proposed based on the total share capital registered on the equity distribution record date[19] - The company faces risks including credit risk, market risk, liquidity risk, and operational risk, but has implemented measures for effective management and control[20] Definitions This section defines common terms used in the report to ensure consistent understanding among readers - "The Bank", "Company", "This Bank" refers to Jiangsu Changshu Rural Commercial Bank Co., Ltd[22] - "Central Bank" refers to the People's Bank of China[22] - "Xingfu Village Bank" refers to Xingfu Village Bank Co., Ltd. and its controlled subsidiaries[22] Company Profile Jiangsu Changshu Rural Commercial Bank Co., Ltd., known as Changshu Bank, is led by Xue Wen, headquartered in Changshu, and listed on the Shanghai Stock Exchange with stock code 601128 - The company's Chinese name is Jiangsu Changshu Rural Commercial Bank Co., Ltd., abbreviated as Changshu Bank[24] - The legal representative is Xue Wen[24] - The company's shares are listed on the Shanghai Stock Exchange, stock code 601128[28] Summary of Key Accounting Data and Financial Indicators In H1 2025, Changshu Bank achieved double-digit growth in operating revenue and net profit attributable to shareholders, with a significant increase in net operating cash flow, while total assets grew to RMB 401.23 billion Key Accounting Data for the Past Three Years (Jan-Jun) | Key Accounting Data | 2025 (Jan-Jun) (Thousand RMB) | 2024 (Jan-Jun) (Thousand RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 6,061,808 | 5,505,688 | 10.10 | | Total Profit | 2,458,174 | 2,179,206 | 12.80 | | Net Profit Attributable to Shareholders of the Listed Company | 1,968,848 | 1,734,471 | 13.51 | | Net Cash Flow from Operating Activities | 21,441,831 | 16,745,436 | 28.05 | Key Financial Indicators for the Past Three Years (Jan-Jun) | Key Financial Indicators | 2025 (Jan-Jun) | 2024 (Jan-Jun) | Change (%) | | :--- | :--- | :--- | :--- | | Basic Earnings Per Share (RMB/share) | 0.59 | 0.52 | 13.46 | | Diluted Earnings Per Share (RMB/share) | 0.48 | 0.43 | 11.63 | | Weighted Average Return on Net Assets (%) | 13.34 | 13.28 | Increase 0.06 percentage points | | Weighted Average Return on Net Assets (Excluding Non-Recurring Gains and Losses) (%) | 13.22 | 13.32 | Decrease 0.10 percentage points | Key Regulatory Indicators (Period-end) | Item (%) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Capital Adequacy Ratio | 13.60 | 14.19 | | Core Tier 1 Capital Adequacy Ratio | 10.73 | 11.18 | | Non-Performing Loan Ratio | 0.76 | 0.77 | | Provision Coverage Ratio | 489.53 | 500.51 | | Liquidity Coverage Ratio (%) | 279.88 | - | - As of June 30, 2025, the Group's total assets reached RMB 401.227 billion, a 9.45% increase from the beginning of the year[29] Management Discussion and Analysis Provides an in-depth review of the bank's business operations, financial performance, and risk management strategies for the reporting period Business Overview Changshu Bank maintains its "Sannong and Two Small" market positioning, building a diversified financial service system including corporate banking, retail banking, financial markets, and village bank businesses, underpinned by strong technology and a unique microfinance model - The company adheres to its "Sannong and Two Small" market positioning, comprehensively deepening the "light capital" path[46] - The company has built a diversified financial service system, covering corporate banking, retail banking, financial market business, and village bank business[46] - The company has formed a strategic development pattern of "based in Changshu, radiating Jiangsu, and deploying nationwide," with 109 Changshu service outlets, 7 Jiangsu branches, and 31 Xingfu Village Banks[48] - The company's "Changyin Microfinance Model" with "IPC technology + credit factory + mobile platform" as its core has solved the "impossible trinity" of small and micro finance efficiency, scale, and risk, serving over 1.5 million small and micro loan customers with a long-term non-performing loan ratio below 1%[49] - The company deeply implements the "Technology-Empowered Bank" strategy, forming five core technology systems including micro-loan integration, risk control integration, accounting processing, channel integration, and data analysis processing, and has obtained CMMI-5, TMMi3, and DCMM3 certifications[50] Discussion and Analysis of Operations In H1 2025, Changshu Bank sustained double-digit growth in revenue and net profit, expanded its asset and liability scale, maintained stable asset quality, and significantly increased non-interest net income, while actively advancing fintech and risk management Key Business Operations Changshu Bank's retail banking saw growth in deposits and loans, with breakthroughs in digital RMB applications; corporate banking focused on inclusive finance and green finance; investment banking supported tech firms; and financial technology enhanced efficiency through AI models - Retail banking personal deposit balance RMB 218.01 billion, a 6.88% increase from the beginning of the year; personal loan balance RMB 136.30 billion, accounting for 54.20% of total loans[52][53] - Online finance expanded to over 20,000 merchants in H1, with over 110 million merchant transactions, a 21.15% year-on-year increase, achieving full-process automated handling of digital RMB medical insurance funds[54] - Corporate banking enterprise deposit balance RMB 64.641 billion, a 17.32% increase from the beginning of the year; enterprise loan balance RMB 95.580 billion, a 6.38% increase from the beginning of the year[55] - Investment banking served over 2,000 technology-based enterprises, with over 300 receiving venture capital equity investments, and a combined financing scale of RMB 14.5 billion, a 34% year-on-year increase[56] - Financial market business received awards such as "Excellent Participant in Bond Agency Clearing Business" from Shanghai Clearing House[59] - Wealth management business saw RMB 7.277 billion in agency wealth management sales, RMB 260 million in agency insurance sales, and private banking client total assets of RMB 28.677 billion, a 10.8% increase from the beginning of the year[60] - Financial technology actively promoted localized deployment and scenario-based implementation of large model technology, successfully launching 6 large model assistants for code generation, knowledge management, and credit review, boosting business efficiency by 20%[61] Key Operating Performance In H1 2025, Changshu Bank's operating revenue and net profit grew by double digits, with total assets exceeding RMB 400 billion, while maintaining stable asset quality and a distinct focus on inclusive small and micro finance 2025 H1 Key Operating Performance Indicators | Indicator | 2025 H1 | Year-on-Year Change/Movement | | :--- | :--- | :--- | | Operating Revenue | 6.062 Billion RMB | 10.10% | | Net Profit Attributable to Shareholders of the Listed Company | 1.969 Billion RMB | 13.51% | | Annualized Return on Assets (ROA) | 1.10% | Increased by 0.02 percentage points | | Annualized Weighted Average Return on Equity (ROE) | 13.34% | Increased by 0.06 percentage points | | Cost-to-Income Ratio | 34.56% | Decreased by 0.62 percentage points | | Net Interest Margin | 2.58% | Maintained at a relatively good industry level | - At the end of the reporting period, the Group's total assets reached RMB 401.227 billion, a 9.45% increase from the beginning of the year; total deposits RMB 310.777 billion, an 8.46% increase; total loans RMB 251.471 billion, a 4.40% increase[63] - Loans to inclusive small and micro enterprises with a single credit line of RMB 10 million and below totaled RMB 104.345 billion, serving 213,300 loan customers, demonstrating a distinct inclusive small and micro finance characteristic[63] - At the end of the reporting period, the Group's non-performing loan ratio was 0.76%, a 0.01 percentage point decrease from the beginning of the year; provision coverage ratio was 489.53%, a 10.98 percentage point decrease from the beginning of the year[64] - Village banks' total assets RMB 63.910 billion, total deposits RMB 55.972 billion, total loans RMB 43.406 billion. Non-performing loan ratio 1.05%, flat from the beginning of the year; provision coverage ratio 336.28%, an 18.94 percentage point increase from the beginning of the year[64] Income Statement Items In H1 2025, Changshu Bank's operating revenue grew by 10.10% and net profit by 13.51%, driven by a significant 57.26% increase in non-interest net income, particularly from fees and commissions and investment gains Major Items of Consolidated Income Statement for Jan-Jun 2025 | Item | 2025 Jan-Jun (Thousand RMB) | 2024 Jan-Jun (Thousand RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Operating Revenue | 6,061,808 | 5,505,688 | 10.10 | | Net Interest Income | 4,639,940 | 4,601,539 | 0.83 | | Non-Interest Net Income | 1,421,868 | 904,149 | 57.26 | | Net Profit Attributable to Shareholders of the Listed Company | 1,968,848 | 1,734,471 | 13.51 | - Operating revenue from areas outside Changshu accounted for 66.52%, and pre-provision profit accounted for 66.62%[68] - Interest income decreased by 2.52% year-on-year, and interest expenses decreased by 6.80% year-on-year, leading to a slight 0.83% increase in net interest income[71][73] - Net fee and commission income was RMB 142 million, a 637.77% increase, primarily due to a 53.09% increase in agency business income and a 39.34% decrease in fee and commission expenses[75][76][77] - Investment income was RMB 1.201 billion, a 30.94% increase, mainly driven by a 560.13% substantial increase in debt investment income[78][79] - Business and management expenses were RMB 2.095 billion, a 8.14% year-on-year increase, with employee expenses increasing by 10.80%[83][84] - Credit impairment losses were RMB 1.494 billion, a 10.97% year-on-year increase, of which impairment losses on loans and advances were RMB 1.334 billion[85][86] Balance Sheet Items At the end of the reporting period, Changshu Bank's total assets reached RMB 401.23 billion, with significant increases in interbank lending, reverse repurchase agreements, and debt investments, while optimizing its deposit structure and reducing funding costs Balance Sheet Items with Changes Exceeding 30% | Item Name | Current Period-End (Thousand RMB) | Change from Previous Year-End (%) | Explanation | | :--- | :--- | :--- | :--- | | Loans to Other Banks and Financial Institutions | 5,799,343 | 56.47 | Increase in interbank lending to domestic non-bank financial institutions | | Derivative Financial Assets | 196,106 | (50.06) | Valuation changes of derivative financial instruments | | Financial Assets Purchased Under Resale Agreements | 500,033 | 100.00 | Increase in securities purchased under resale agreements | | Trading Financial Assets | 14,098,735 | 32.35 | Increase in debt investments and other trading financial assets | | Other Debt Investments | 47,516,329 | 44.66 | Increase in debt investments and interbank certificates of deposit | | Trading Financial Liabilities | 4,042,487 | 100.00 | Increase in trading financial liabilities | | Financial Assets Sold Under Repurchase Agreements | 14,227,308 | 47.12 | Increase in securities sold under repurchase agreements | | Taxes Payable | 204,568 | (42.01) | Decrease in income tax payable | | Other Liabilities | 1,503,332 | (37.23) | Decrease in funds to be transferred | - During the reporting period, the Bank strengthened proactive liability management, optimized pricing strategies, continuously adjusted deposit structure, and reduced deposit costs, resulting in a net interest margin of 2.44% and a net interest spread of 2.58%[92][93] - The Group's total loans were RMB 251.471 billion, a 4.40% increase from the beginning of the year. Personal loans accounted for 54.20% of total loans[95] - The Group's total deposits were RMB 310.777 billion, an 8.46% increase. Corporate deposits accounted for 20.8% of total deposits, a 1.57 percentage point increase from the beginning of the year. Demand deposits accounted for 19.04% of total deposits, a 0.93 percentage point increase from the beginning of the year[102] - The Group's bonds payable were RMB 6.175 billion, a RMB 1.751 billion decrease from the end of the previous year, a 22.09% decrease, mainly due to a reduction in interbank certificates of deposit[104][106] Cash Flow Statement Items In H1 2025, Changshu Bank's net cash flow from operating activities significantly increased to RMB 21.44 billion, while net cash flows from investing and financing activities were negative Net Cash Flow for Jan-Jun 2025 | Item | 2025 Jan-Jun (Thousand RMB) | 2024 Jan-Jun (Thousand RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 21,441,831 | 16,745,436 | 28.05 | | Net Cash Flow from Investing Activities | (12,504,510) | (10,788,771) | - | | Net Cash Flow from Financing Activities | (2,723,077) | (1,566,446) | - | Loan Quality Analysis Changshu Bank maintained a non-performing loan ratio of 0.76%, with a decrease in corporate NPLs and an increase in personal NPLs, while credit-guaranteed loans increased and loan migration rates showed varied trends - The Group's non-performing loan ratio was 0.76%, maintaining a relatively good level in the industry[111] Loan Five-Category Classification Distribution (Period-end) | Five-Category Classification | Loan Amount (Thousand RMB) | % of Total Loans | Loan-to-Provision Ratio (%) | | :--- | :--- | :--- | :--- | | Normal Loans | 245,597,430 | 97.67 | 2.82 | | Special Mention Loans | 3,954,033 | 1.57 | 27.37 | | Substandard Loans | 1,635,661 | 0.65 | 68.21 | | Doubtful Loans | 140,669 | 0.05 | 87.31 | | Loss Loans | 142,872 | 0.06 | 100.00 | | Total | 251,470,665 | 100.00 | 3.74 | - Corporate loan non-performing ratio was 0.56%, a 0.09 percentage point decrease from the beginning of the year; personal loan non-performing ratio was 1.02%, with credit card non-performing ratio decreasing by 1.34 percentage points from the beginning of the year[114] - Corporate loans were primarily concentrated in manufacturing, construction and leasing services, and wholesale and retail industries, with non-performing ratios showing a downward trend[117] - Loans of RMB 10 million and below totaled RMB 181.341 billion, accounting for 72.11% of total loans; loan customers numbered 568,400, accounting for 99.64% of total loan customers[119] - Credit-guaranteed loan balance was RMB 137.341 billion, accounting for 54.61% of total loans, a 1.05 percentage point increase from the end of the previous year. Credit loan non-performing ratio was 0.95%, a 0.03 percentage point decrease from the beginning of the year[125] Loan Migration Rate (%) | Item (%) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Normal Loan Migration Rate | 0.95 | 1.76 | | Special Mention Loan Migration Rate | 17.39 | 21.48 | | Substandard Loan Migration Rate | 24.88 | 21.42 | | Doubtful Loan Migration Rate | 18.96 | 20.47 | Off-Balance Sheet Wealth Management Investment Assets As of June 2025, Changshu Bank's off-balance sheet wealth management investment assets totaled RMB 33.655 billion, primarily invested in corporate bonds and policy bank financial bonds Composition of Off-Balance Sheet Wealth Management Investment Assets (June 30, 2025) | Item | Amount (Thousand RMB) | % | | :--- | :--- | :--- | | Corporate Bonds | 20,018,535 | 59.48 | | Policy Bank Financial Bonds | 5,528,774 | 16.43 | | Commercial Bank Financial Bonds | 4,289,346 | 12.75 | | Interbank Certificates of Deposit | 2,413,703 | 7.17 | | Funds | 344,750 | 1.02 | | Financial Assets Purchased Under Resale Agreements | 758,637 | 2.25 | | Cash | 248,155 | 0.74 | | Government Bonds | 52,896 | 0.16 | | Total | 33,654,796 | 100.00 | Off-Balance Sheet Items with Significant Impact on Financial Position and Operating Results As of June 30, 2025, Changshu Bank's off-balance sheet credit commitments totaled RMB 4.80 billion, financial guarantee contracts RMB 42.61 billion (mainly bank acceptance bills), and capital expenditure commitments RMB 280 million Off-Balance Sheet Items (June 30, 2025) | Item | June 30, 2025 (Thousand RMB) | | :--- | :--- | | Credit Commitments | 4,800,455 | | Of which: Unused Credit Card Limits | 4,800,455 | | Financial Guarantee Contracts | 42,613,715 | | Of which: Letters of Credit Issued | 5,229,696 | | Bank Acceptance Bills | 36,807,538 | | Letters of Guarantee Issued | 576,481 | | Capital Expenditure Commitments | 279,851 | Investment Status Changshu Bank directly controls Xingfu Village Bank, holding 90% equity, which in turn controls 30 village banks, with Xingfu Village Bank reporting RMB 63.91 billion in total assets and RMB 362.28 million in net profit - The company directly controls the investment management bank (Xingfu Village Bank Co., Ltd.), holding 90% equity, and the investment management bank controls 30 village banks[139][140] Key Accounting Data and Financial Indicators of Xingfu Village Bank (June 30, 2025) | Indicator | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | Change (%) | | :--- | :--- | :--- | :--- | | Total Assets | 63,909,561 | 62,428,025 | 2.37 | | Total Loans | 43,406,115 | 43,610,742 | (0.47) | | Total Deposits | 55,971,952 | 53,611,742 | 4.40 | | Net Profit (Jan-Jun) | 362,281 | 327,487 | 10.62 | | Non-Performing Loan Ratio | 1.05% | 1.05% | Flat | | Provision Coverage Ratio | 336.28% | 317.34% | Increased by 18.94 percentage points | - The company holds equity in 8 institutions, being the largest shareholder in Jiangsu Zhenjiang Rural Commercial Bank Co., Ltd., Jiangsu Baoying Rural Commercial Bank Co., Ltd., and Lianyungang Dongfang Rural Commercial Bank Co., Ltd[139] - As of the end of the reporting period, the company had 174 branches, 4,490 employees, and total assets of RMB 345.192 billion[152][153] Wealth Management, Asset Securitization, and Private Banking Business As of June 2025, Changshu Bank's wealth management products totaled RMB 30.512 billion (all non-guaranteed, net-value products), asset securitization balance was RMB 914 million, and private banking client assets grew by 10.8% - As of the end of June 2025, the company's wealth management products totaled RMB 30.512 billion, all being non-guaranteed, net-value wealth management products[154] - In H1 2025, the company had no credit asset transfers, and the asset securitization balance was RMB 914 million[155] - As of the end of June 2025, agency wealth management sales were RMB 7.277 billion, agency insurance sales were RMB 260 million, private banking client total assets were RMB 28.677 billion, and private banking clients numbered 4,214, a 10.8% increase from the beginning of the year[156] Risks and Risk Management Changshu Bank manages credit, liquidity, market, operational, compliance, anti-money laundering, and reputational risks through a comprehensive framework, including enhanced credit management, digital risk control, active asset-liability management, and robust compliance - In credit risk management, the company continuously improves its comprehensive risk management system, implements various credit management measures, strengthens digital risk control system construction, focuses on optimizing small and micro credit processes and innovating risk control methods, strictly manages asset classification, enhances asset quality monitoring and control, and actively innovates non-performing asset disposal methods[158][159] - In liquidity risk management, the company continuously operates its proactive asset-liability management mechanism, strengthens indicator control, regularly conducts stress tests, and closely monitors changes in monetary and credit policies and interbank market funds[161] - In market risk management, the company strengthens risk management for both trading and banking books, identifying, monitoring, and controlling interest rate risk through limit indicators, valuation systems, stress tests, and trading strategy adjustments, while adhering to prudent principles for financial derivative products[163][164][165] - In operational risk management, the company improves its operational risk management system, strengthens risk prevention and control in key areas, utilizes management tools such as RCSA, KRI, LDC, and enhances system platform support[167] - In compliance risk management, the company adheres to the "compliance starts from the top" philosophy, establishes and improves a long-term compliance management mechanism, strengthens organizational guarantees, standardizes operations, enhances performance, and strengthens compliance culture system construction and technological support[169][170] - In anti-money laundering and counter-terrorist financing risk management, the company focuses on "establishing mechanisms," "improving efficiency," and "strengthening responsibility" by optimizing suspicious transaction monitoring models, enhancing correlation analysis, deeply promoting customer information governance, and diligently conducting inspections and supervision[172] - In reputational risk management, the company standardizes information disclosure, stabilizes market expectations, monitors public opinion, properly handles complaints, strengthens brand building, enhances positive publicity, and implements consumer protection requirements to improve effectiveness[174] Balances and Risk Exposures of Related Party Transactions with Related Natural Persons As of the end of the reporting period, Changshu Bank's related party transactions with related natural persons were within the estimated limits, with a loan balance and risk exposure of RMB 38.5232 million - As of the end of the reporting period, the loan balance and risk exposure to related natural persons was RMB 38.5232 million[175] Significant Events Changshu Bank's H1 2025 profit distribution plan proposes a cash dividend of RMB 1.50 per 10 shares; the bank reported new and cumulative pending lawsuits, conducted related party transactions within limits, and actively fulfilled social responsibilities - The 2025 semi-annual profit distribution plan proposes a cash dividend of RMB 1.50 (tax inclusive) per 10 shares[176] - In H1 2025, the Group added 4,113 new pending lawsuits as plaintiff, involving RMB 1.233 billion[177] - As of the end of June 2025, the Group had a cumulative total of 9,127 pending lawsuits as plaintiff, involving RMB 3.288 billion[177] - The company's transactions with related parties were conducted under general commercial terms and normal business procedures, and within the annual estimated limits[179] - As of the end of the reporting period, the Bank's outstanding guarantee balance for issued letters of guarantee was RMB 576.4811 million[180] - The company fully implements the concept of sustainable development, adheres to its "Sannong and Two Small" market positioning, deepens rural revitalization, empowers green development, and promotes public welfare[181][182][183][184][185] Corporate Governance Details changes in the board of directors, investor relations activities, and the company's commitment to "quality improvement, efficiency enhancement, and high returns" through serving the real economy, strengthening "five key areas," and prioritizing investor returns Changes in Ordinary Shares and Shareholder Information Changshu Bank's total share capital increased to 3,316,497,842 shares due to a capital reserve transfer and convertible bond conversion, with 41,254 ordinary shareholders and Bank of Communications remaining the largest shareholder at 9.01% Changes in Ordinary Shares | Item | Quantity Before Change (Shares) | Increase/Decrease (+, -) (Shares) | Quantity After Change (Shares) | | :--- | :--- | :--- | :--- | | Unlimited Tradable Shares | 3,014,984,424 | 301,513,418 | 3,316,497,842 | | Of which: Capital Reserve Conversion | - | 301,498,645 | - | | Convertible Bond Conversion | - | 14,773 | - | | Total Shares | 3,014,984,424 | 301,513,418 | 3,316,497,842 | - As of the end of the reporting period, the total number of ordinary shareholders was 41,254[198] - Bank of Communications Co., Ltd. is the largest shareholder, holding 298,744,997 shares at the end of the period, with a 9.01% stake[200] - The shareholdings of the company's directors, supervisors, and senior management increased due to the capital reserve transfer[204] Information on Convertible Corporate Bonds Changshu Bank issued RMB 6 billion in "Changyin Convertible Bonds" in 2022, with RMB 5.9996 billion remaining unconverted, and its credit rating maintained at "AAA" with a stable outlook - The company publicly issued RMB 6 billion A-share convertible corporate bonds on September 15, 2022, with the bond abbreviation "Changyin Convertible Bonds" and bond code "113062"[207] - As of the end of the reporting period, the number of convertible bondholders was 15,357[208] - A total of 14,773 shares were converted during the reporting period, with cumulative converted shares accounting for 0.002% of the company's total issued shares before conversion[210] - The unconverted amount was RMB 5,999,598,000, and the proportion of unconverted convertible bonds to the total issuance was 99.9933%[210] - The conversion price has been adjusted multiple times, with the latest conversion price being RMB 6.04/share as of the end of this reporting period[211] - China Chengxin International maintained the Bank's corporate credit rating at "AAA" with a stable outlook; the credit rating for "Changyin Convertible Bonds" was also maintained at "AAA"[212] Corporate Governance Changshu Bank saw changes in its board of directors, actively engaged with institutional investors, and is implementing a "quality improvement, efficiency enhancement, and high returns" plan focused on serving the real economy, strengthening key financial areas, and enhancing investor returns - Mr. Sun Ming resigned as an executive director of the Bank in March 2025 due to work adjustments, and Mr. Tang Zhifeng was appointed as an executive director[213] - During the reporting period, the company hosted numerous institutional investors, including Guosheng Securities, China Asset Management, JPMorgan Chase, and Goldman Sachs Group, through various channels such as in-person meetings, online conferences, and broker strategy sessions[213][214][215] - The company actively implements the "Quality Improvement, Efficiency Enhancement, and High Returns" action plan, focusing on its core business, promoting high-quality development, increasing financial supply, strengthening its primary role in supporting agriculture and small businesses, and accelerating services for new productive forces[216][217] - The company diligently promotes "five key areas" of financial services: technology finance, green finance, inclusive finance, elderly care finance, and digital finance, enhancing the quality and effectiveness of financial services to the real economy[218][219] - The company standardizes its corporate governance system, strengthens organizational guarantees, adheres to standardized operations, enhances performance, and safeguards the interests of all shareholders and stakeholders[220][221][222] - The company values investor returns, improves the quality and efficiency of information disclosure, strengthens investor communication, increases dividend frequency, optimizes dividend rhythm, and formulated and implemented the 2025 interim profit distribution plan[223] Financial Report Presents Changshu Bank's consolidated and parent company financial statements, including balance sheets, income statements, cash flow statements, and statements of changes in equity, along with detailed notes on accounting policies and risk management Financial Statements This section provides Changshu Bank's consolidated and parent company balance sheets, income statements, cash flow statements, and statements of changes in equity as of June 30, 2025, showing total assets of RMB 401.23 billion and net profit of RMB 1.97 billion Major Data of Consolidated Balance Sheet (June 30, 2025) | Item | June 30, 2025 (Thousand RMB) | December 31, 2024 (Thousand RMB) | | :--- | :--- | :--- | | Total Assets | 401,226,615 | 366,581,851 | | Total Liabilities | 369,268,317 | 335,913,331 | | Total Equity Attributable to Parent Company Shareholders | 29,873,923 | 28,647,828 | Major Data of Consolidated Income Statement (Jan-Jun 2025) | Item | 2025 H1 (Thousand RMB) | 2024 H1 (Thousand RMB) | | :--- | :--- | :--- | | I. Total Operating Revenue | 6,061,808 | 5,505,688 | | V. Net Profit | 2,117,267 | 1,879,639 | | Net Profit Attributable to Parent Company Shareholders | 1,968,848 | 1,734,471 | | Basic Earnings Per Share (RMB / share) | 0.59 | 0.52 | | Diluted Earnings Per Share (RMB / share) | 0.48 | 0.43 | Major Data of Consolidated Cash Flow Statement (Jan-Jun 2025) | Item | 2025 H1 (Thousand RMB) | 2024 H1 (Thousand RMB) | | :--- | :--- | :--- | | Net Cash Flow from Operating Activities | 21,441,831 | 16,745,436 | | Net Cash Flow from Investing Activities | (12,504,510) | (10,788,771) | | Net Cash Flow from Financing Activities | (2,723,077) | (1,566,446) | Notes to Financial Statements This section details Changshu Bank's financial statement preparation basis, significant accounting policies, estimates, tax information, consolidated financial statement item notes, equity in other entities, financial instrument risks, fair value disclosures, related parties, commitments, entrusted and agency businesses, post-balance sheet events, and supplementary information Company Information Changshu Bank, established in 2001, operates 7 branches, 72 sub-branches, and 1 direct business department, and controls Xingfu Village Bank and its 30 village bank subsidiaries - The Bank was registered and established in Changshu City, Jiangsu Province on December 3, 2001, and renamed Jiangsu Changshu Rural Commercial Bank Co., Ltd. on August 18, 2004[255] - As of June 30, 2025, the Bank had 7 branches, 72 sub-branches, and 1 direct business department[256] - The Bank's controlled subsidiary, Xingfu Village Bank Co., Ltd., and its controlled subsidiaries include 26 village banks initiated and controlled by the Group in Hubei, Jiangsu, Henan, and Yunnan provinces, and 4 village banks in Guangdong, Hainan, and Jiangsu provinces acquired through non-same-control business combinations[257] Basis of Preparation of Financial Statements The Group's financial statements are prepared in accordance with PRC accounting standards and relevant regulations, based on a going concern assumption, using the accrual basis, and primarily historical cost measurement - The Group implements the Enterprise Accounting Standards and relevant regulations issued by the Ministry of Finance, and discloses financial information with reference to "Information Disclosure Rules for Companies Issuing Securities to the Public No. 15 – General Provisions for Financial Reports (Revised 2023)"[259] - These financial statements are prepared on a going concern basis[260] - The Group's accounting is based on the accrual method. Except for certain financial instruments measured at fair value, these financial statements use historical cost as the measurement basis[261] Significant Accounting Policies and Accounting Estimates This section details Changshu Bank's significant accounting policies and estimates for financial statement preparation, covering financial instrument classification, impairment, asset transfers, derivatives, long-term equity investments, fixed assets, intangible assets, employee benefits, and revenue recognition - The financial statements prepared by the company comply with the requirements of Enterprise Accounting Standards, truly and completely reflecting the company's financial position, operating results, changes in shareholders' equity, and cash flows[262] - The classification of financial assets depends on the results of the contractual cash flow test and business model test, categorized as measured at amortized cost, at fair value through other comprehensive income, or at fair value through profit or loss[284][286][387] - The Group performs impairment accounting and recognizes loss provisions for financial assets measured at amortized cost and financial assets measured at fair value through other comprehensive income based on expected credit losses[292] - The Group's revenue primarily derives from net interest income, fee and commission income, and dividend income, recognized based on the timing of fulfilling performance obligations[352][353][354][356] - In applying accounting policies, the Group made significant judgments, estimates, and assumptions in areas such as financial asset classification, impairment under the expected credit loss model, fair value of financial instruments, judgment on consolidation of structured entities, and income tax[386][387][388][392][393][394] Taxation Changshu Bank's main taxes include corporate income tax (25% or 15%), VAT (3% to 13%), urban maintenance and construction tax, education surcharges, and local education surcharges, with some village banks enjoying a 15% corporate income tax rate Major Tax Categories and Rates | Tax Category | Tax Basis | Tax Rate | | :--- | :--- | :--- | | Corporate Income Tax | Taxable Income | 25%, 15% | | Value-Added Tax | Taxable Revenue | 3%, 5%, 6%, 9%, 13% | | Urban Maintenance and Construction Tax | Actual Paid Turnover Tax | 5%, 7% | | Education Surcharge | Actual Paid Turnover Tax | 3% | | Local Education Surcharge | Actual Paid Turnover Tax | 2% | - The Group's village banks located in Hainan and Enshi Tujia and Miao Autonomous Prefecture in Hubei Province, and Yunnan region, enjoy a preferential corporate income tax rate of 15%[395] Notes to Consolidated Financial Statement Items This section provides detailed notes on Changshu Bank's consolidated financial statement items, including cash and central bank deposits, interbank placements, loans and advances, financial investments, fixed assets, deposits, bonds payable, net interest income, investment income, and cash flow information - As of June 30, 2025, statutory deposit reserves with the central bank were RMB 15.444 billion, and the RMB deposit reserve ratio was 5.00%[397] - Total loans and advances were RMB 251.471 billion, of which personal loans and advances were RMB 136.30 billion, and corporate loans and advances were RMB 88.955 billion[405] - Total deposits absorbed were RMB 310.777 billion, of which demand deposits were RMB 59.179 billion, and time deposits were RMB 223.472 billion[454] - Total bonds payable were RMB 6.208 billion, of which convertible corporate bonds were RMB 5.676 billion, and interbank certificates of deposit were RMB 499 million[464] - From January to June 2025, operating revenue was RMB 6.062 billion, net interest income was RMB 4.640 billion, non-interest net income was RMB 1.422 billion, and net profit attributable to shareholders of the listed company was RMB 1.969 billion[67][483] - From January to June 2025, net cash flow from operating activities was RMB 21.442 billion, net cash flow from investing activities was -RMB 12.505 billion, and net cash flow from financing activities was -RMB 2.723 billion[110] Interests in Other Entities Changshu Bank completed the acquisition of two village banks, controls Xingfu Village Bank (90% stake) which in turn controls 30 village banks, and manages RMB 30.512 billion in off-balance sheet wealth management products - The Group completed non-same-control business combinations in Jan-Jun 2025, acquiring 100% equity in Jiangsu Baoying Jincheng Village Bank Co., Ltd. and Jiangsu Jiangning Shangyin Village Bank Co., Ltd[522][523] - Xingfu Village Bank Co., Ltd. is a controlled subsidiary of the Bank, with a 90.00% stake, and minority shareholder equity of RMB 2.084 billion at period-end[526][528] - Xingfu Village Bank's total assets at period-end were RMB 63.910 billion, total deposits RMB 55.972 billion, total loans RMB 43.406 billion, and net profit for the current period was RMB 362.281 million[530][531] - The Group accounts for Jiangsu Baoying Rural Commercial Bank Co., Ltd. (18.09% stake) and Jiangsu Zhenjiang Rural Commercial Bank Co., Ltd. (33.33% stake) using the equity method[536] - The balance of non-guaranteed wealth management products managed by the Group and not included in the scope of consolidation was RMB 30.512 billion[534] - The Group's investments in structured entities not included in the scope of consolidation, including funds, asset-backed securities, trusts and asset management plans, and debt financing plans, totaled RMB 11.491 billion in book value[538] Risks Related to Financial Instruments Changshu Bank manages credit, liquidity, and market risks through a comprehensive framework, including risk stage classification, expected credit loss measurement, proactive asset-liability management, and market risk limits, while maintaining capital adequacy ratios above regulatory requirements - The Group's operating activities face credit risk, market risk, operational risk, and liquidity risk, which are managed through identification, measurement, assessment, and monitoring to ensure prudent, compliant, and stable operations[541] - Credit risk management involves market access, loan approval, credit exit, risk early warning, and non-performing asset disposal mechanisms, and categorizes each business into three risk stages based on whether the financial instrument's credit risk has significantly increased since initial recognition, to accrue expected credit losses[543][544] - As of June 30, 2025, the Group's restructured loan balance was RMB 1.469 billion, accounting for 0.58% of total loans[554] - The maximum credit risk exposure, without considering collateral, pledges, and other credit enhancement measures, totaled RMB 440.046 billion[557][558] - Liquidity risk management has established analysis, monitoring, early warning, information exchange, and feedback mechanisms for liquidity management, and is managed through proactive asset-liability management, indicator control, and stress tests[577] - Market risk management controls interest rate risk by adjusting the maturity structure of assets and liabilities and implementing market risk limit management, and avoids exchange rate risk by optimizing the foreign currency asset and liability structure[596] - As of June 30, 2025, the Group's core Tier 1 capital adequacy ratio was 10.73%, Tier 1 capital adequacy ratio was 10.78%, and capital adequacy ratio was 13.60%, all meeting regulatory requirements[627] Disclosure of Fair Value Changshu Bank discloses fair value levels for financial assets and liabilities, with derivatives and bond investments in Level 2, and certain loans and equity investments in Level 3, noting significant differences between book and fair values for debt investments and bonds payable Fair Value Levels of Financial Assets and Liabilities Measured at Fair Value (June 30, 2025) | Item | Level 2 Fair Value Measurement (Thousand RMB) | Level 3 Fair Value Measurement (Thousand RMB) | Total (Thousand RMB) | | :--- | :--- | :--- | :--- | | Derivative Financial Assets | 196,106 | - | 196,106 | | Loans and Advances Measured at Fair Value Through Other Comprehensive Income | - | 26,215,854 | 26,215,854 | | Trading Financial Assets | 13,707,187 | 391,548 | 14,098,735 | | Other Debt Investments | 47,516,329 | - | 47,516,329 | | Other Equity Instrument Investments | - | 786,386 | 786,386 | | Total Financial Assets | 61,419,622 | 27,393,788 | 88,813,410 | | Trading Financial Liabilities | 4,042,487 | - | 4,042,487 | | Derivative Financial Liabilities | 197,701 | - | 197,701 | | Total Financial Liabilities | 4,240,188 | - | 4,240,188 | - Financial assets and liabilities classified as Level 2 primarily include derivative financial instruments, bonds, and fund investments, with fair values determined through discounted cash flows or independent third-party valuations[628] - Financial assets classified as Level 3 primarily include loans and advances measured at fair value through other comprehensive income, and other equity instrument investments, using discounted cash flow and market approaches, involving unobservable parameters such as discount rates and liquidity discounts[629] Financial Instruments with Differences Between Fair Value and Book Value (June 30, 2025) | Item | Book Value (Thousand RMB) | Fair Value (Thousand RMB) | | :--- | :--- | :--- | | Debt Investments | 48,793,144 | 52,509,966 | | Bonds Payable | 6,207,840 | 13,422,736 | Related Parties and Related Party Transactions Changshu Bank's related parties include major shareholders, subsidiaries, and associates, with related party transactions in H1 2025 including interest income of RMB 16.23 million, interest expenses of RMB 12.623 million, and key management personnel compensation of RMB 4.44 million - Bank of Communications Co., Ltd. holds 9.01% of the company's shares and is a related party without a controlling relationship[639] - Related parties include entities controlled by Bank of Communications Co., Ltd., Changshu Development Investment Co., Ltd., Jiangsu Jiangnan Commercial and Trade Group Co., Ltd., Changshu Development Investment Co., Ltd., and Jiangsu Jiangnan Commercial and Trade Group Co., Ltd[642][643] - Related natural persons include the Bank's directors, supervisors, senior management, and their spouses, parents, adult children, and their spouses[644] Related Party Transactions (Jan-Jun 2025) | Item | Current Period Amount (Thousand RMB) | | :--- | :--- | | Interest Income | 16,230 | | Interest Expense | 12,623 | | Key Management Personnel Compensation | 4,440 | - As of period-end, the balance of interbank placements with Bank of Communications Co., Ltd. was RMB 281 million, the notional principal of derivative financial instruments was RMB 1.719 billion, other debt investments were RMB 890 million, and reverse repurchase agreements were RMB 400 million[650][651][653][656] - As of period-end, the total balance of loans and advances to related legal entities and related natural persons was RMB 536 million, and total deposits absorbed was RMB 689 million[652][656] Commitments and Contingencies As of June 30, 2025, Changshu Bank's capital commitments for fixed and intangible assets totaled RMB 280 million, credit commitments were RMB 47.414 billion (mainly bank acceptance bills and unused credit card limits), and pending lawsuits were not expected to have a significant impact - As of June 30, 2025, the Group's capital commitments were all for investments in fixed assets and intangible assets, with RMB 280 million contracted but unpaid[657] Credit Commitments (June 30, 2025) | Item | Period-End (Thousand RMB) | | :--- | :--- | | Letters of Credit Issued | 5,229,696 | | Letters of Guarantee Issued | 576,481 | | Bank Acceptance Bills Issued | 36,807,538 | | Unused Credit Card Limits | 4,800,455 | | Total | 47,414,170 | - The Group has several pending legal disputes in its normal course of business, but an assessment indicates no significant impact on the Group[660] Entrusted and Agency Business Changshu Bank conducts entrusted loan and deposit businesses, with balances of RMB 1.428 billion each, and manages RMB 30.512 billion in entrusted wealth management assets - The Group issues entrusted loans on behalf of third-party lenders and enters into contracts with them to manage and recover loans, with loan loss risk borne by the third-party lenders[661] - As of period-end, the balances of entrusted loans and entrusted deposits were both RMB 1.428 billion[662] - As of period-end, the Group's total entrusted wealth management assets were RMB 30.512 billion[664] Post-Balance Sheet Events Changshu Bank's board approved the H1 2025 profit distribution plan, proposing a cash dividend of RMB 1.50 (tax inclusive) per 10 shares to ordinary shareholders - The Bank's board meeting approved the 2025 semi-annual profit distribution plan, proposing a cash dividend of RMB 1.50 (tax inclusive) per 10 shares to ordinary shareholders registered on the equity distribution record date[665] Other Significant Matters Changshu Bank has an annuity plan, operates three main business segments (corporate, personal, and treasury), and provides a classification table for financial instrument measurement bases - The Group has established an annuity plan, with contributions jointly borne by the company and individual participants, and company contributions not exceeding 8% of the previous year's total employee wages[666] - The Group includes corporate business, personal business, and treasury business as its three main operating segments, as well as other business segments[667][668][669][670] Operating Segment Information (Jan-Jun 2025) | Item | Corporate Business (Thousand RMB) | Personal Business (Thousand RMB) | Treasury Business (Thousand RMB) | Other Business (Thousand RMB) | Total (Thousand RMB) | | :--- | :--- | :--- | :--- | :--- | :--- | | I. Operating Revenue | 1,702,235 | 3,139,786 | 1,172,578 | 47,209 | 6,061,808 | | II. Operating Expenses | 986,641 | 2,295,922 | 338,909 | 4 | 3,621,476 | | III. Operating Profit | 715,594 | 843,864 | 833,669 | 47,205 | 2,440,332 | | IV. Total Assets | 117,998,399 | 143,216,255 | 137,612,117 | 2,399,844 | 401,226,615 | | V. Total Liabilities | 93,927,659 | 223,820,888 | 49,247,062 | 2,272,708 | 369,268,317 | - Financial asset items are classified based on measurement basis into those measured at amortized cost, classified as fair value through other comprehensive income, designated as non-trading equity instrument investments at fair value through other comprehensive income, and financial assets at fair value through profit or loss[673][674] - Financial liability items are classified based on measurement basis into financial liabilities measured at amortized cost and financial liabilities at fair value through profit or loss[677][679] Supplementary Information This section provides Changshu Bank's non-recurring gains and losses for H1 2025, totaling RMB 14.515 million, with RMB 16.849 million attributable to ordinary shareholders, along with government subsidies and net asset return calculations Details of Non-Recurring Gains and Losses for Jan-Jun 2025 | Item | Amount (Thousand RMB) | | :--- | :--- | | Gains and Losses from Disposal of Non-Current Assets | 5,336 | | Government Subsidies Recognized in Profit or Loss | 109 | | Other Non-Operating Income and Expenses Apart from the Above | 17,733 | | Less: Income Tax Impact | (8,663) | | Total | 14,515 | | Of which: Non-Recurring Gains and Losses Attributable to Ordinary Shareholders of the Parent Company (After Tax) | 16,849 | | Non-Recurring Gains and Losses Attributable to Minority Shareholders (After Tax) | (2,334) | - From January to June 2025, government subsidies recognized in profit or loss totaled RMB 110.417 million[681] Return on Net Assets and Earnings Per Share (Jan-Jun 2025) | Profit for the Reporting Period | Weighted Average Return on Net Assets (%) | Basic Earnings Per Share | Diluted Earnings Per Share | | :--- | :--- | :--- | :--- | | Net Profit Attributable to Ordinary Shareholders of the Company | 6.67 | 0.59 | 0.48 | | Net Profit Attributable to Ordinary Shareholders of the Company After Deducting Non-Recurring Gains and Losses | 6.61 | 0.59 | 0.47 |