招商银行(03968) - 2025 - 中期财报

Definitions This section provides definitions of key terms used throughout the report Significant Risk Warning The company has detailed major risks and mitigation measures in the report, with further information available in Chapter 3 on risk management - The Company has detailed major risks and mitigation measures in the report; please refer to Chapter 3 for risk management content[5] Important Notice This section highlights the report's accuracy, profit distribution plans, unaudited financial statements, and forward-looking statements - The Company's Board of Directors, Supervisory Board, and senior management guarantee the truthfulness, accuracy, and completeness of this report, assuming individual and joint legal responsibility[7] - The Company's 2025 interim profit distribution plan has been approved by the 2024 Annual General Meeting, with cash dividends to be distributed between January and February 2026[7] - The financial report contained herein is unaudited but has been reviewed by Ernst & Young Hua Ming LLP (China Accounting Standards) and Ernst & Young (International Financial Reporting Standards)[7] - This report contains forward-looking statements regarding the Group's financial position, operating results, and business development, which are based on current plans, estimates, and forecasts, and do not constitute a substantive commitment by the Group; investors should not over-rely on them and should be aware of investment risks[7] Chapter 1 Company Profile This chapter provides an overview of the company's establishment, operational scope, strategic vision, and stock listing information 1.1 Company Overview China Merchants Bank, established in 1987 with headquarters in Shenzhen, offers wholesale and retail banking services across China and major global financial centers, aiming to be an "innovation-driven, model-leading, distinctive best value-creating bank" - The Company was established in 1987, headquartered in Shenzhen, China, with branches primarily in major Chinese cities and international financial centers such as Hong Kong, New York, London, Singapore, and Sydney[12] - The Company provides wholesale and retail banking products and services, including account and payment settlement services based on "All-in-One Card" debit cards and credit cards, tiered wealth management services like "Sunflower Wealth Management" and private banking, retail credit services, and online services such as the China Merchants Bank App, Life App, and "All-in-One Net" integrated online banking[13] - The Company's strategic vision is to become an "innovation-driven, model-leading, distinctive best value-creating bank," accelerating its transformation towards "internationalization, comprehensive operations, differentiation, and digitalization"[13] Stock Listing Information | Stock Type | Exchange | Stock Abbreviation | Stock Code | | :--- | :--- | :--- | :--- | | A-share | Shanghai Stock Exchange | China Merchants Bank | 600036 | | H-share | Hong Kong Stock Exchange | China Merchants Bank | 03968 | | Domestic Preferred Stock | Shanghai Stock Exchange | CMB Pref 1 | 360028 | Chapter 2 Summary of Accounting Data and Financial Indicators This chapter presents a concise overview of the Group's key accounting data, financial performance, and financial ratios for the reporting period 2.1 Key Accounting Data and Financial Indicators of the Group In H1 2025, the Group's net operating income decreased by 1.73% year-on-year, while net profit attributable to shareholders increased by 0.25%; total assets and customer deposits grew steadily, and the non-performing loan ratio decreased by 0.02 percentage points to 0.93% Key Accounting Data and Financial Indicators of the Group (H1 2025 vs H1 2024, RMB million) | Indicator | H1 2025 | H1 2024 | Year-on-year change (%) | | :--- | :--- | :--- | :--- | | Net operating income | 169,923 | 172,922 | -1.73 | | Profit before tax | 88,906 | 89,641 | -0.82 | | Net profit attributable to the Bank's shareholders | 74,930 | 74,743 | 0.25 | | Basic earnings per share attributable to the Bank's ordinary shareholders (RMB) | 2.89 | 2.89 | – | | Diluted earnings per share attributable to the Bank's ordinary shareholders (RMB) | 2.89 | 2.89 | – | Scale Indicators of the Group (June 30, 2025 vs December 31, 2024, RMB million) | Indicator | June 30, 2025 | December 31, 2024 | Change from end of previous year (%) | | :--- | :--- | :--- | :--- | | Total assets | 12,657,151 | 12,152,036 | 4.16 | | Of which: Total loans and advances | 7,116,616 | 6,888,315 | 3.31 | | Total liabilities | 11,360,291 | 10,918,561 | 4.05 | | Of which: Total customer deposits | 9,422,379 | 9,096,587 | 3.58 | | Equity attributable to the Bank's shareholders | 1,289,233 | 1,226,014 | 5.16 | | Net assets per ordinary share attributable to the Bank's ordinary shareholders (RMB) | 42.10 | 41.46 | 1.54 | 2.2 Financial Ratios of the Group In H1 2025, the Group's profitability ratios (ROAA, ROAE, net interest margin, net interest income ratio) declined, and the cost-to-income ratio increased; capital adequacy ratios (CET1, Tier 1, total) also decreased, but the non-performing loan ratio fell by 0.02 percentage points to 0.93%, maintaining stable asset quality Profitability Ratios of the Group (Annualized, %) | Indicator (%) | H1 2025 | H1 2024 | Year-on-year change | | :--- | :--- | :--- | :--- | | Return on average total assets attributable to the Bank's shareholders | 1.21 | 1.32 | Decreased by 0.11 percentage points | | Return on average net assets attributable to the Bank's ordinary shareholders | 13.85 | 15.44 | Decreased by 1.59 percentage points | | Net interest margin | 1.79 | 1.88 | Decreased by 0.09 percentage points | | Net interest income ratio | 1.88 | 2.00 | Decreased by 0.12 percentage points | | Cost-to-income ratio | 30.11 | 29.75 | Increased by 0.36 percentage points | Capital Adequacy Ratios of the Group (Advanced Approach, %) | Indicator (%) | June 30, 2025 | December 31, 2024 | Change from end of previous year | | :--- | :--- | :--- | :--- | | Common Equity Tier 1 capital adequacy ratio | 14.00 | 14.86 | Decreased by 0.86 percentage points | | Tier 1 capital adequacy ratio | 17.07 | 17.48 | Decreased by 0.41 percentage points | | Capital adequacy ratio | 18.56 | 19.05 | Decreased by 0.49 percentage points | Asset Quality Indicators of the Group | Indicator (%) | June 30, 2025 | December 31, 2024 | Change from end of previous year | | :--- | :--- | :--- | :--- | | Non-performing loan ratio | 0.93 | 0.95 | Decreased by 0.02 percentage points | | Provision coverage ratio | 410.93 | 411.98 | Decreased by 1.05 percentage points | | Loan loss provision ratio | 3.83 | 3.92 | Decreased by 0.09 percentage points | | Credit cost (annualized) | 0.67 | 0.77 | Decreased by 0.10 percentage points | Chapter 3 Management Discussion and Analysis This chapter provides a comprehensive analysis of the Group's operating performance, financial position, asset quality, capital adequacy, and strategic implementation 3.1 Overall Operating Performance Analysis In H1 2025, China's economy grew steadily, but the banking sector faced narrowing net interest margins and pressure on net operating income; the Group achieved balanced development, with net operating income decreasing by 1.73% year-on-year, net profit attributable to shareholders increasing by 0.25%, steady growth in assets and liabilities, and stable asset quality with the non-performing loan ratio falling to 0.93% - In H1 2025, the Chinese economy faced complex situations and multiple challenges, achieving steady growth; under the influence of LPR reductions and insufficient effective credit demand, banks' net interest margins further narrowed, and net operating income pressure remained significant[19] - During the reporting period, the Group achieved net operating income of RMB 169.923 billion, a year-on-year decrease of 1.73%; net profit attributable to the Bank's shareholders was RMB 74.930 billion, a year-on-year increase of 0.25%[20] - As of the end of the reporting period, the Group's total assets were RMB 12,657.151 billion, an increase of 4.16% from the end of the previous year; total loans and advances were RMB 7,116.616 billion, an increase of 3.31% from the end of the previous year[20] - As of the end of the reporting period, the Group's non-performing loan balance was RMB 66.370 billion, an increase of RMB 0.760 billion from the end of the previous year; the non-performing loan ratio was 0.93%, a decrease of 0.02 percentage points from the end of the previous year[21] 3.2 Income Statement Analysis In H1 2025, the Group's profit before tax decreased by 0.82% year-on-year, and net operating income decreased by 1.73%; net interest income grew by 1.57%, but net interest margin and net interest income ratio both declined, while non-interest net income decreased by 6.77% due to lower bank card and settlement fees despite growth in wealth management fees; operating expenses slightly increased by 0.07%, and credit impairment losses decreased by 8.56% Key Income Statement Items of the Group (RMB million) | Indicator | H1 2025 | H1 2024 | | :--- | :--- | :--- | | Net interest income | 106,085 | 104,449 | | Net fee and commission income | 37,602 | 38,328 | | Other net income | 24,564 | 28,595 | | Total operating income | 168,251 | 171,372 | | Operating expenses | (56,383) | (56,345) | | Credit impairment losses | (24,623) | (26,928) | | Profit before tax | 88,906 | 89,641 | | Net profit | 75,405 | 75,379 | | Net profit attributable to the Bank's shareholders | 74,930 | 74,743 | - During the reporting period, the Group achieved net operating income of RMB 169.923 billion, a year-on-year decrease of 1.73%, with net interest income accounting for 62.43% and non-interest net income accounting for 37.57%, a year-on-year decrease of 2.03 percentage points[24] - During the reporting period, the Group achieved interest income of RMB 177.014 billion, a year-on-year decrease of 5.84%, primarily due to a decrease in the yield on interest-earning assets; interest income from loans and advances was RMB 119.080 billion, a year-on-year decrease of 9.93%, mainly affected by the reduction in interest rates for existing mortgage loans and LPR[25][26] - During the reporting period, the Group's net interest income was RMB 106.085 billion, a year-on-year increase of 1.57%; the annualized average yield on interest-earning assets was 3.14%, a year-on-year decrease of 46 basis points; the annualized average cost of interest-bearing liabilities was 1.35%, a year-on-year decrease of 37 basis points; net interest margin was 1.79%, a year-on-year decrease of 9 basis points; net interest income ratio was 1.88%, a year-on-year decrease of 12 basis points[36][37] - During the reporting period, the Group achieved non-interest net income of RMB 63.838 billion, a year-on-year decrease of 6.77%; of which, net fee and commission income was RMB 37.602 billion, a year-on-year decrease of 1.89%, with wealth management fee and commission income increasing by 11.89% to RMB 12.797 billion; bank card fee income was RMB 7.221 billion, a year-on-year decrease of 16.37%[41] - During the reporting period, the Group's operating expenses were RMB 56.383 billion, a year-on-year increase of 0.07%; the cost-to-income ratio was 30.11%, a year-on-year increase of 0.36 percentage points[45] - During the reporting period, the Group's credit impairment losses were RMB 24.623 billion, a year-on-year decrease of 8.56%, mainly due to the Group's continuous optimization of asset and customer structures, maintaining stable asset quality for loan and guarantee commitment businesses[48][49] 3.3 Balance Sheet Analysis As of the end of the reporting period, the Group's total assets grew by 4.16% to RMB 12,657.151 billion, driven by increases in loans and advances and financial investments; total liabilities grew by 4.05% to RMB 11,360.291 billion, mainly due to steady growth in customer deposits, which increased by 3.58%, though the proportion of demand deposits decreased, indicating a trend towards time deposits; shareholders' equity increased by 5.16%, despite declines in investment revaluation reserves and foreign currency translation differences - As of the end of the reporting period, the Group's total assets were RMB 12,657.151 billion, an increase of 4.16% from the end of the previous year, mainly due to the growth in the Group's loans and advances and financial investments[50] Composition of Total Assets (RMB million) | Indicator | June 30, 2025 | Percentage of total (%) | December 31, 2024 | Percentage of total (%) | | :--- | :--- | :--- | :--- | :--- | | Total loans and advances | 7,116,616 | 56.23 | 6,888,315 | 56.68 | | Investment securities and other financial assets | 3,973,551 | 31.39 | 3,705,919 | 30.50 | | Cash, precious metals and deposits with central banks | 568,565 | 4.49 | 583,202 | 4.80 | | Interbank balances | 934,457 | 7.38 | 896,707 | 7.38 | | Total assets | 12,657,151 | 100.00 | 12,152,036 | 100.00 | - As of the end of the reporting period, the Group's total liabilities were RMB 11,360.291 billion, an increase of 4.05% from the end of the previous year, mainly due to the steady growth in customer deposits[67] Composition of Total Liabilities (RMB million) | Indicator | June 30, 2025 | Percentage of total (%) | December 31, 2024 | Percentage of total (%) | | :--- | :--- | :--- | :--- | :--- | | Customer deposits | 9,422,379 | 82.94 | 9,096,587 | 83.31 | | Interbank balances | 1,118,033 | 9.84 | 1,017,506 | 9.32 | | Borrowings from central banks | 171,752 | 1.51 | 189,511 | 1.74 | | Debt securities issued | 162,020 | 1.43 | 221,583 | 2.03 | | Total liabilities | 11,360,291 | 100.00 | 10,918,561 | 100.00 | - As of the end of the reporting period, the Group's total customer deposits were RMB 9,422.379 billion, an increase of 3.58% from the end of the previous year; during the reporting period, the average daily balance of demand deposits as a percentage of the average daily balance of customer deposits was 49.72%, a decrease of 0.62 percentage points from the full previous year, indicating a market-wide trend towards time deposits[70][71] - As of the end of the reporting period, the Group's equity attributable to the Bank's shareholders was RMB 1,289.233 billion, an increase of 5.16% from the end of the previous year; of which, investment revaluation reserves decreased by 11.75%, and foreign currency translation differences decreased by 36.98%[72] 3.4 Loan Quality Analysis As of the end of the reporting period, the Group's non-performing loan balance was RMB 66.370 billion, with a non-performing loan ratio of 0.93%, a decrease of 0.02 percentage points from the end of the previous year; corporate loan NPL ratio decreased, while retail loan NPL ratio increased; the real estate NPL ratio was 4.74%, a decrease of 0.20 percentage points; total overdue loans increased, but the ratio of NPLs to loans overdue for over 90 days was 1.28; loan loss provisions increased, while provision coverage and loan loss provision ratios slightly decreased - As of the end of the reporting period, the Group's non-performing loan balance was RMB 66.370 billion, an increase of RMB 0.760 billion from the end of the previous year; the non-performing loan ratio was 0.93%, a decrease of 0.02 percentage points from the end of the previous year[75] Five-Category Loan Classification (RMB million) | Category | Amount as of June 30, 2025 | Percentage of total (%) | Amount as of December 31, 2024 | Percentage of total (%) | | :--- | :--- | :--- | :--- | :--- | | Normal loans | 6,948,779 | 97.64 | 6,733,625 | 97.76 | | Special mention loans | 101,467 | 1.43 | 89,080 | 1.29 | | Non-performing loans | 66,370 | 0.93 | 65,610 | 0.95 | | Total loans and advances | 7,116,616 | 100.00 | 6,888,315 | 100.00 | - Corporate loan balance was RMB 3,089.691 billion, an increase of 7.89% from the end of the previous year, with an NPL ratio of 0.93%, a decrease of 0.13 percentage points from the end of the previous year; retail loan balance was RMB 3,678.188 billion, an increase of 0.92% from the end of the previous year, with an NPL ratio of 1.03%, an increase of 0.07 percentage points from the end of the previous year[79] - Loans to the real estate industry amounted to RMB 311.554 billion, with an NPL ratio of 4.74%, a decrease of 0.20 percentage points from the end of the previous year[80] - As of the end of the reporting period, the Group's overdue loans totaled RMB 97.084 billion, an increase of RMB 5.209 billion from the end of the previous year, with an overdue loan ratio of 1.36%, an increase of 0.03 percentage points from the end of the previous year; the ratio of the Company's non-performing loans to loans overdue for more than 60 days was 1.12[90] - As of the end of the reporting period, the Group's loan loss provision balance was RMB 272.733 billion, an increase of RMB 2.432 billion from the end of the previous year; the provision coverage ratio was 410.93%, a decrease of 1.05 percentage points from the end of the previous year; the loan loss provision ratio was 3.83%, a decrease of 0.09 percentage points from the end of the previous year[94] 3.5 Capital Adequacy Analysis As of the end of the reporting period, the Group's and the Company's Common Equity Tier 1, Tier 1, and total capital adequacy ratios under the advanced approach all decreased, primarily due to cash dividends, but still met regulatory requirements; the leverage ratio slightly increased, and credit, market, and operational risk-weighted assets were disclosed - According to the various capital requirements of financial regulatory authorities, and the additional capital and leverage ratio requirements of the "Additional Regulatory Provisions for Systemically Important Banks (Trial)", the Group's and the Company's capital adequacy ratio, Tier 1 capital adequacy ratio, and Common Equity Tier 1 capital adequacy ratio should not be lower than 11.25%, 9.25%, and 8.25% respectively, and the leverage ratio should not be lower than 4.375%; during the reporting period, the Group and the Company consistently met all capital and leverage ratio regulatory requirements[95] Capital Adequacy Ratios of the Group under Advanced Approach (RMB million) | Indicator | June 30, 2025 | December 31, 2024 | Change from end of previous year (%) | | :--- | :--- | :--- | :--- | | Common Equity Tier 1 capital adequacy ratio | 14.00% | 14.86% | Decreased by 0.86 percentage points | | Tier 1 capital adequacy ratio | 17.07% | 17.48% | Decreased by 0.41 percentage points | | Capital adequacy ratio | 18.56% | 19.05% | Decreased by 0.49 percentage points | | Leverage ratio | 8.48% | 8.46% | Increased by 0.02 percentage points | - As of the end of the reporting period, the Group's Common Equity Tier 1 capital adequacy ratio, Tier 1 capital adequacy ratio, and capital adequacy ratio under the advanced approach were 14.00%, 17.07%, and 18.56% respectively, decreasing by 0.86, 0.41, and 0.49 percentage points from the end of the previous year; the decrease in all capital adequacy ratios was mainly due to the impact of cash dividends[99] - As of the end of the reporting period, the Group's market risk-weighted assets were RMB 380.712 billion, with a market risk capital requirement of RMB 30.457 billion; the Group's operational risk-weighted assets were RMB 715.762 billion, with an operational risk capital requirement of RMB 57.261 billion[110][111] 3.6 Segment Operating Results In H1 2025, retail finance business profit before tax increased by 1.64% year-on-year, accounting for 58.53% of the Group's total, and net operating income increased by 0.25%, accounting for 56.60%; wholesale finance business saw growth in both profit before tax and net operating income Summary of Operating Results by Business Segment of the Group (RMB million) | Item | H1 2025 Segment Profit Before Tax | H1 2025 Net Operating Income | H1 2024 Segment Profit Before Tax | H1 2024 Net Operating Income | | :--- | :--- | :--- | :--- | :--- | | Retail Finance Business | 52,036 | 96,179 | 51,198 | 95,939 | | Wholesale Finance Business | 37,057 | 70,301 | 36,433 | 72,022 | | Other Businesses | (187) | 3,443 | 2,010 | 4,961 | | Total | 88,906 | 169,923 | 89,641 | 172,922 | - During the reporting period, the Group's retail finance business achieved profit before tax of RMB 52.036 billion, a year-on-year increase of 1.64%, accounting for 58.53% of the Group's profit before tax, an increase of 1.42 percentage points year-on-year; net operating income was RMB 96.179 billion, a year-on-year increase of 0.25%, accounting for 56.60% of the Group's net operating income, an increase of 1.12 percentage points year-on-year[113] 3.7 Other Financial Information Disclosed According to Regulatory Requirements The Group's off-balance sheet items primarily include derivative financial instruments, commitments, and contingent liabilities, with credit commitments being the largest component at RMB 3,258.649 billion; as of the end of the reporting period, the Group had no overdue outstanding debts - The Group's off-balance sheet items include derivative financial instruments, commitments, and contingent liabilities; as of the end of the reporting period, the Group's credit commitment balance was RMB 3,258.649 billion[114] - As of the end of the reporting period, the Group had no overdue outstanding debts[115] 3.8 Implementation of Development Strategy The Company advanced its value banking strategy, accelerating "internationalization, comprehensive operations, differentiation, and digitalization" transformation; it achieved steady growth in customer numbers and AUM, maintained high ROAA and ROAE, accelerated international development with overseas institutions' net operating income growing by 23.72%, deepened comprehensive operations with subsidiaries' asset management and leasing businesses ranking high, demonstrated strong differentiated competitive advantages in retail and corporate finance, accelerated digitalization with IT investment at 2.93% of net operating income and AI applications across business areas, and continuously optimized its management and risk compliance systems - During the reporting period, the Company deeply promoted its value banking strategy, adhering to high-quality development and multi-objective balance, accelerating the "internationalization, comprehensive operations, differentiation, and digitalization" transformation, and maintaining steady and improving operating performance[116] - As of the end of the reporting period, the total number of retail customers was 216 million, an increase of 2.86% from the end of the previous year, and the total number of corporate customers was 3.3679 million, an increase of 6.36% from the end of the previous year; the annualized ROAA and ROAE for the reporting period were 1.21% and 13.85% respectively, maintaining a relatively high level globally[117] - Total assets of overseas institutions at the end of the reporting period increased by 6.56% from the end of the previous year, and net operating income for the reporting period increased by 23.72% year-on-year[118] - As of the end of the reporting period, CMB Wealth Management's wealth management product balance was RMB 2.46 trillion, maintaining a leading position among bank wealth management companies; CMB Financial Leasing's leasing business placement amount for the reporting period was RMB 55.427 billion, maintaining a leading position in the financial leasing industry; China Merchants Fund's non-money market public fund management scale was RMB 522.889 billion, maintaining a leading position in the industry[120] - As of the end of the reporting period, the Company's Assets Under Management (AUM) for retail customers totaled RMB 16.03 trillion, an increase of 7.39% from the end of the previous year; retail wealth management fee and commission income for the reporting period increased by 6.00% year-on-year[121] - As of the end of the reporting period, corporate loan balance was RMB 2,798.720 billion, an increase of 8.04% from the end of the previous year; the Company's technology enterprise loan balance was RMB 696.205 billion, an increase of 17.91% from the end of the previous year; public green loan balance was RMB 414.714 billion, an increase of 12.90% from the beginning of the year[122] - During the reporting period, the Company's information technology investment was RMB 4.444 billion, reaching 2.93% of the Company's net operating income; as of the end of the reporting period, the Group had 10,782 R&D personnel, accounting for 9.13% of the Group's total employees[125] - As of the end of the reporting period, the Company's non-performing loan ratio was 0.92%, a decrease of 0.01 percentage points from the end of the previous year[135] 3.9 Key Issues in Operations The Group's net interest income ratio remained under pressure due to declining asset yields and a trend towards time deposits; non-interest net income decreased year-on-year, but wealth management income grew; real estate risk control strengthened, with related business balances and NPL ratios declining; customer deposits grew steadily, but the time deposit trend continued; corporate loans grew significantly, while retail loan growth faced pressure; NPL formation rate decreased, and disposal efforts intensified; asset quality in key areas remained stable overall, but NPL ratios for consumer credit and small and micro loans increased; capital adequacy ratios remained high, with continuous optimization of capital allocation strategies - During the reporting period, the Group's and the Company's net interest income ratios were 1.88% and 1.94% respectively, a year-on-year decrease of 12 and 13 basis points, mainly due to declining asset yields and a trend towards time deposits on the liability side[137] - During the reporting period, the Group achieved non-interest net income of RMB 63.838 billion, a year-on-year decrease of 6.77%; the Group's wealth management income was RMB 20.857 billion, a year-on-year increase of 5.45%[140] - As of the end of the reporting period, the Group's real estate-related credit and contingent credit, proprietary bond investments, proprietary non-standard investments, and other businesses bearing credit risk totaled RMB 360.962 billion, a decrease of 3.51% from the end of the previous year; the Company's real estate non-performing loan ratio was 4.56%, a decrease of 0.18 percentage points from the end of the previous year[144] - As of the end of the reporting period, the Company's customer deposit balance was RMB 9,063.432 billion, an increase of 3.25% from the end of the previous year; the average daily balance of demand deposits as a percentage of the average daily balance of customer deposits was 50.26%, a decrease of 0.77 percentage points from the full previous year, indicating a market-wide trend towards time deposits[146] - As of the end of the reporting period, the Company's corporate loans were RMB 2,798.720 billion, an increase of 8.04% from the end of the previous year; retail loans were RMB 3,611.408 billion, an increase of 0.94% from the end of the previous year[149] - During the reporting period, the Company generated new non-performing loans of RMB 32.721 billion, a year-on-year increase of RMB 0.749 billion; the annualized non-performing loan formation rate was 0.98%, a year-on-year decrease of 0.04 percentage points; a total of RMB 31.846 billion in non-performing loans were disposed of during the reporting period[151] - As of the end of the reporting period, the Company's non-performing loan ratio for consumer credit businesses was 1.64%, an increase of 0.10 percentage points from the end of the previous year; the non-performing loan ratio for retail small and micro loans was 0.96%, an increase of 0.17 percentage points from the end of the previous year[156][157] - As of the end of the reporting period, the Company's risk-weighted assets to total assets ratio under the advanced approach was 56.52%; the Company's Risk-Adjusted Return on Capital (RAROC, pre-tax) under the advanced approach for the reporting period was 23.53%[158] 3.10 Business Operations The Company's retail finance business profit before tax increased by 0.02% year-on-year, while net operating income decreased by 0.71%, but AUM and private banking client numbers grew; credit card transaction volume and non-interest income declined, yet asset quality remained stable; wholesale finance business profit before tax decreased by 5.73% and net operating income by 5.87%, but corporate client financing and technology enterprise loan balances grew significantly; total asset management scale slightly decreased, though CMB International's asset management grew; custody asset balance increased by 5.60%; financial market transaction volume surged; distribution channels saw enhanced online and offline services, and overseas branches operated steadily; most major subsidiaries were profitable, except for CMB Europe Key Financial Data of the Company's Retail Finance Business (RMB million) | Indicator | H1 2025 | H1 2024 | Year-on-year growth (%) | | :--- | :--- | :--- | :--- | | Profit before tax | 49,977 | 49,967 | 0.02 | | Net operating income | 93,256 | 93,920 | -0.71 | | Retail net interest income | 69,130 | 68,909 | 0.32 | | Retail non-interest net income | 24,126 | 25,011 | -3.56 | | Retail wealth management fee and commission income | 11,272 | 10,634 | 6.00 | | Retail bank card fee income | 7,159 | 8,569 | -16.48 | - As of the end of the reporting period, the Company's Assets Under Management (AUM) for retail customers totaled RMB 16,029.395 billion, an increase of 7.39% from the end of the previous year; private banking customers numbered 182,740, an increase of 8.07% from the end of the previous year[160][164] - During the reporting period, the Company's credit card transaction volume was RMB 2,020.960 billion, a year-on-year decrease of 8.54%; credit card interest income was RMB 30.612 billion, a year-on-year decrease of 4.96%; credit card non-interest income was RMB 10.471 billion, a year-on-year decrease of 16.23%; the credit card non-performing loan ratio was 1.75%, flat compared to the end of the previous year[166] Key Financial Data of the Company's Wholesale Finance Business (RMB million) | Indicator | H1 2025 | H1 2024 | Year-on-year growth (%) | | :--- | :--- | :--- | :--- | | Profit before tax | 33,135 | 35,145 | -5.73 | | Net operating income | 60,872 | 64,668 | -5.87 | | Wholesale finance business net interest income | 38,110 | 37,030 | 2.92 | | Wholesale finance business non-interest net income | 22,762 | 27,638 | -17.65 | - As of the end of the reporting period, the Company's total financing for corporate customers (FPA) was RMB 6,454.492 billion, an increase of RMB 395.469 billion from the beginning of the year; technology enterprise loan balance was RMB 696.205 billion, an increase of 17.91% from the end of the previous year[172][182] - As of the end of the reporting period, the total asset management scale of the Company's subsidiaries CMB Wealth Management, China Merchants Fund, China Merchants Cigna Asset Management, and CMB International was RMB 4.45 trillion, a decrease of 0.51% from the end of the previous year; CMB International's asset management scale was HKD 147.966 billion, an increase of 13.53% from the end of the previous year[198] - As of the end of the reporting period, the Company's custody asset balance was RMB 24.14 trillion, an increase of 5.60% from the end of the previous year, with the total custody scale ranking among the top in the industry[203] - During the reporting period, RMB bond investment transaction volume was RMB 4.58 trillion, a year-on-year increase of 182.72%; financial market wholesale customer business transaction volume was USD 159.176 billion, a year-on-year increase of 25.16%[204] Operating Results of Major Overseas Branches (Net Operating Income) | Branch Name | Net Operating Income (during reporting period) | | :--- | :--- | | Hong Kong Branch | HKD 1.538 billion | | New York Branch | USD 48.9733 million | | Singapore Branch | USD 18.0577 million | | Luxembourg Branch | EUR 12.7146 million | | London Branch | USD 21.6047 million | | Sydney Branch | AUD 33.9476 million | Operating Results of Major Subsidiaries (Net Profit) | Subsidiary Name | Net Profit (during reporting period) | | :--- | :--- | | Wing Lung Bank | HKD 3.037 billion | | CMB Financial Leasing | RMB 2.839 billion | | CMB International | HKD 1.371 billion | | CMB Wealth Management | RMB 1.364 billion | | China Merchants Fund | RMB 0.789 billion | | China Merchants Cigna Asset Management | RMB 0.071 billion | | CMB Europe | EUR -1.025 million | | China Merchants Cigna (Joint Venture) | RMB 0.308 billion | | China Union Consumer Finance (Joint Venture) | RMB 1.504 billion | 3.11 Risk Management The Company upholds a prudent risk culture, strengthening comprehensive risk management to ensure overall stable asset quality; credit risk management involves optimizing credit policies, enhancing key area risk prevention, and intensifying NPL recovery and disposal efforts; large exposure and country risks are within regulatory limits; market risk, including interest rate and exchange rate risks in trading and banking books, is effectively monitored; operational risk management continuously improves, focusing on cybersecurity and data security; liquidity risk management is prudent, with all indicators meeting regulatory requirements; reputation and compliance risk management mechanisms are optimized, and anti-money laundering risk management effectiveness is enhanced - The Company closely focused on its value banking strategy, adhered to a prudent risk culture and risk appetite, continuously consolidated its fortress-style risk and compliance management system, and maintained the bottom line of preventing systemic risks[234] - In wholesale finance business credit risk management, the Group optimized credit and investment policies, continuously improved admission standards for corporate, interbank, and institutional clients, strengthened control over key risk areas, and promoted credit structure optimization; in retail finance business credit risk management, the Group primarily relies on credit assessment of applicants as the basis for granting personal credit, evaluating applicants' income, credit history, and loan repayment ability[236] - As of the end of the reporting period, except for regulatory exempted clients, the Company's non-interbank single clients, non-interbank group clients, interbank single clients, and interbank group clients that met large exposure standards all complied with regulatory requirements; at the end of the reporting period, the Company's country risk exposure was mainly concentrated in low-risk countries or regions, and country risk is not expected to have a significant adverse impact on the Company's business operations[239][240] - The Company's trading book investment scope is primarily RMB bonds, and it generally adopted cautious trading strategies and prudent risk control measures, ensuring that all interest rate risk indicators for the trading book were within target ranges; as of the end of the reporting period, all on-balance sheet and off-balance sheet management measures were progressing as planned, interest rate risk levels were controlled within the annual interest rate risk management targets, and all indicators, including stress test results, remained within limits and warning values, with overall stable interest rate risk in the banking book[243][245] - During the reporting period, the Company continuously improved its operational risk management system with the goal of preventing systemic operational risks and significant operational risk losses; first, by strengthening the operational risk event and loss management mechanism; second, by focusing on risk control in key business areas; third, by focusing on cybersecurity and data security; fourth, by further improving business continuity management; and fifth, by improving system management tools and functions to enhance digitalization capabilities[250] - As of the end of the reporting period, all of the Company's liquidity indicators met regulatory requirements, and it had sufficient funding sources to meet the needs of continuous healthy business development; the Company's liquidity indicators performed well, deposits maintained stable growth, liquidity reserves were ample, and overall liquidity was secure[252] - During the reporting period, the Company strictly implemented the requirements of the "Measures for the Management of Reputation Risk of Banking and Insurance Institutions (Trial)" and continuously optimized its reputation risk management mechanism; the Company established a complete and effective compliance risk management system through a management organizational structure consisting of the Board's Risk and Capital Management Committee, head office and branch risk and compliance management committees, compliance officers, and compliance supervisors, achieving effective control over compliance risk[254][255] - During the reporting period, the Company actively fulfilled its anti-money laundering obligations and continuously improved the effectiveness of money laundering risk management; first, by strengthening training and promotion of the "Anti-Money Laundering Law"; second, by continuously strengthening money laundering risk management for customers and products; third, by improving suspicious transaction monitoring tools; and fourth, by continuing to increase technology investment in key anti-money laundering areas to promote the level of anti-money laundering digitalization[257] 3.12 Outlook and Countermeasures Looking ahead to H2, global economic growth is expected to be moderate with uncertainties, while the domestic economy is projected to continue its recovery; the Company will deepen its value banking strategy by strengthening foundations, accelerating "four transformations," adhering to risk and compliance bottom lines, and building a "strict management, integrity, and innovation" model to address low-interest rate challenges and achieve high-quality development - Domestically, achieving the full-year economic growth target of around 5% in 2025 has solid support; first, consumption's contribution to economic growth is strengthening; second, real estate investment may continue to decline but with weakened drag; third, economic policies will be anchored to economic and social development tasks, continuously exerting effort and adding strength as appropriate[258] - The Company will strengthen its foundation, maintaining coordinated development in quality, efficiency, and scale; it will focus on its core, doing well in the three basic businesses of deposits, loans, and intermediary services, and consolidating the three fundamental aspects of customer base, asset quality, and market share[259] - Accelerate the "internationalization, comprehensive operations, differentiation, and digitalization" transformation, leading the construction of a digital China Merchants Bank with "AI First," striving to become a globally leading intelligent bank[260] - Adhere to the bottom line, persistently strengthening risk and compliance management; enhance risk prevention and resolution in key areas, strengthen proactive risk prevention in real estate, supply-demand mismatch in production capacity, and retail credit, and intensify efforts in non-performing asset recovery and disposal[261] - Continuously build a new model of high-quality development characterized by "strict management, integrity, and innovation"; strengthen asset-liability management, improving its refinement and foresight; strengthen full-cost management, improving its lean level; strengthen innovation-driven development, increasing innovation in products, services, management, technology, models, and institutional mechanisms[261] Chapter 4 Environmental, Social, and Governance (ESG) This chapter details the Company's commitment to ESG principles, its social responsibility initiatives, and efforts to create comprehensive value for stakeholders and promote sustainable development 4.1 Overview of Environmental, Social, and Governance The Company actively practices ESG principles, fulfills social responsibilities, creates comprehensive value for customers, employees, shareholders, partners, and society, and promotes sustainable economic and social development - The Company actively practices ESG principles, earnestly fulfills its social responsibilities, continuously creates comprehensive value for customers, employees, shareholders, partners, and society, and contributes to sustainable economic and social development[262] 4.2 Environmental Information The Company actively responds to national carbon peak and neutrality strategies, accelerates green finance development, and improves its green operations management system; the Board is responsible for environmental (climate) management and green finance strategy, integrating ESG factors into risk appetite and client admission standards; progress was made in green credit, deposits, bonds, and investments, while green operations deepened carbon reduction, promoted paperless offices, and strengthened energy, water, and waste management - During the reporting period, the Company actively responded to national carbon peak and carbon neutrality strategic goals, accelerated the development of green finance, improved its green operations management system, promoted green development transformation, and fostered harmonious coexistence between humanity and nature[263] - The Company's Board of Directors plays a strategic leading role in environmental (climate) management and green finance; the Green Finance Business Development Committee is responsible for coordinating and promoting the Bank's green finance work[264][265] - ESG factors, including climate, are integrated into the risk appetite, explicitly requiring enhanced understanding of green development trends in key areas, increased support for green, low-carbon, and circular economies, improved ESG risk management, and strict control over clients and projects with significant ESG risks[267] - As of the end of the reporting period, the Company's green loan balance was RMB 566.799 billion, an increase of 12.55% from the beginning of the year; cumulative green deposits handled amounted to RMB 13.760 billion, an increase of 13.14% from the end of the previous year[270] - During the reporting period, the Company lead-underwrote debt financing instruments totaling RMB 7.889 billion; subsidiary CMB International assisted 18 enterprises in issuing 20 green bonds, with a financing scale of USD 6.356 billion, a year-on-year increase of 95.09%[271] - During the reporting period, 548,600 paperless reimbursement documents were processed, saving 2.1944 million sheets of paper; electronic seals were used 71.7603 million times, saving 113 million sheets of paper[275] 4.3 Social Responsibility Information The Company actively serves the real economy by increasing loans to green economy, manufacturing, technological innovation, inclusive small and micro enterprises, and agricultural sectors; it supports education, housing, medical security, and migrant worker wage supervision for livelihood improvement; financial service accessibility is enhanced through optimized online/offline channels, elderly-friendly adaptations, and payment convenience; robust cybersecurity and data security management systems are in place, with no major incidents; customer privacy and consumer rights protection are strengthened; the Company actively participates in rural revitalization and philanthropy; human capital development adheres to a "talent-strong bank" strategy, building a professional talent system with equal employment and comprehensive compensation benefits - As of the end of the reporting period, the Company's manufacturing loan balance was RMB 691.308 billion, an increase of 7.77% from the end of the previous year; technology enterprise loan balance was RMB 696.205 billion, an increase of 17.91% from the end of the previous year; during the reporting period, the Company issued RMB 315.980 billion in loans to inclusive small and micro enterprises, with an outstanding balance of RMB 913.347 billion at the end of the period[278] - As of the end of the reporting period, the Company collaborated with 178 education authorities at various levels nationwide, cumulatively safeguarding parents' course purchase funds for 137 million person-times; cumulative activation of medical insurance electronic certificates (medical insurance codes) reached 33.2471 million; cumulative safeguarding of migrant worker wage payments reached RMB 318.330 billion[282][284] - As of the end of the reporting period, the China Merchants Bank App "Elderly Version" had 2.4149 million customers; as one of the first domestic pilot banks, the Company launched the Cross-border Payment Connect product, opening a more efficient and convenient new channel for cross-border payment services for residents of mainland China and Hong Kong[286][287] - The Company has established a comprehensive cybersecurity management framework covering four major areas: internet service security, intranet security, office security, and third-party security; during the reporting period, the Company experienced no major cybersecurity, information, or data security incidents[288][289] - The Company strictly complies with national laws and regulations such as the "Personal Information Protection Law of the People's Republic of China" and continuously strengthens the protection of customer personal information; during the reporting period, the Company experienced no major customer privacy leakage incidents[291][293] - In terms of consumer protection review, 97,700 products and services were reviewed during the reporting period, achieving 100% coverage; in financial education, financial education activities covered 287 million consumer person-times during the reporting period[295] - During the reporting period, the Company directly invested RMB 24.784 million in rural revitalization assistance funds; total external donations amounted to RMB 9.5303 million, continuously participating in philanthropy[297][298] - The Company consistently adheres to the "talent-strong bank" strategy, is committed to building the "best employee growth bank," and focuses on establishing a "professional, diversified, market-oriented, and international" talent system; as of June 30, 2025, the Group had a total of 118,068 employees, with 10,782 R&D personnel, accounting for 9.13% of the Group's total employees[299][330] 4.4 Governance Information The Company continuously improves its corporate governance mechanism, adhering to the President responsibility system under Board leadership and market-oriented professional principles; the Board and Supervisory Board actively fulfill their duties, reviewing numerous important proposals and promoting inclusive finance, green finance, data governance, and consumer rights protection; the Company highly values business ethics, preventing corruption and money laundering through training and audits - The Company continuously promotes the improvement of its corporate governance mechanism, adheres to the "two consistent" principles, constantly enhances its corporate governance level, and maintains a philosophy of steady development and prudent risk management; the key to the corporate governance mechanism is adherence to the President responsibility system under the leadership of the Board of Directors and adherence to market-oriented and professional principles[305] - During the reporting period, the Company's Board of Directors actively fulfilled its responsibilities in inclusive finance, green finance, data governance, human capital, consumer rights protection, social responsibility, and other areas, reviewing multiple related proposals; the Company's Supervisory Board researched and reviewed multiple proposals, supervising key matters such as inclusive finance, green finance, data governance, consumer rights protection, and social responsibility[306][307] - The Company highly values the supervision, warning, education, and training of business ethics; it conducts anti-corruption system training and warning education, as well as other business ethics-related training activities for all employees, consciously resisting and strictly prohibiting participation in illegal activities such as money laundering, commercial bribery, corruption, insider trading, and market manipulation[309] - The Company annually formulates internal audit plans covering business ethics matters, conducts special audits on anti-money laundering and sanctions compliance management annually, conducts regular audits of overseas institutions and subsidiaries annually, and conducts regular audits of domestic branches annually[310] Chapter 5 Corporate Governance This chapter outlines the Company's corporate governance structure, including the functions and operations of the Shareholders' Meeting, Board of Directors, Supervisory Board, and their respective committees 5.1 Overview of Corporate Governance During the reporting period, the Company's Shareholders' Meeting, Board of Directors, Supervisory Board, and their respective special committees performed their duties efficiently, ensuring compliant and stable operations; one Shareholders' Meeting, ten Board meetings, twenty-two Board special committee meetings, and seven Supervisory Board meetings were held, with no significant discrepancies between actual corporate governance and legal requirements - During the reporting period, the Company's Shareholders' Meeting, Board of Directors, Supervisory Board, and their respective special committees performed their duties efficiently, fully ensuring the Company's compliant and stable operations and sustained healthy development[312] - During the reporting period, the Company held 1 Shareholders' Meeting, 10 Board of Directors meetings, 22 Board of Directors special committee meetings, and 7 Supervisory Board meetings[312] - Through diligent self-inspection, the Company found no significant discrepancies between its actual corporate governance situation during the reporting period and the requirements of laws, administrative regulations, and normative documents of the China Securities Regulatory Commission concerning corporate governance of listed companies[312] 5.2 Shareholders' Meeting Convening Status The 2024 Annual General Meeting, held on June 25, 2025, approved 13 proposals, including Board and Supervisory Board work reports, profit distribution plans, capital management plans, auditor appointments, and director elections, with meeting procedures complying with relevant regulations - The Company's 2024 Annual General Meeting, held on June 25, 2025, reviewed and approved 13 proposals, including the 2024 Board of Directors' Work Report, 2024 Supervisory Board's Work Report, 2024 Annual Report (including audited financial report), 2024 Financial Final Account Report, 2024 Profit Distribution Plan (including declaration of final dividend), 2025 Interim Profit Distribution Plan, 2025-2029 Capital Management Plan, appointment of 2025 auditors, election of directors for the Thirteenth Board of Directors, discontinuation of the Supervisory Board, revision of the Articles of Association, and 2024 Related Party Transactions Report[313] - The notice, convening, holding, and voting procedures of the meeting all complied with the relevant provisions of the "Company Law of the People's Republic of China," "Articles of Association of China Merchants Bank Co., Ltd.," and the Hong Kong Listing Rules[313] 5.3 Directors, Supervisors, and Senior Management During the reporting period, there were changes in the Company's directors, supervisors, and senior management, including new appointments (Zhu Liwei, Huang Jian, Xu Mingjie, Lei Caihua) and departures (Zhang Jian, Chen Dong, Zhu Jiangtao as directors; Luo Sheng, Xu Zhengjun, Cai Jin as supervisors); all directors and supervisors complied with the standard code for securities transactions during the period List of Directors, Supervisors, and Senior Management and Shareholdings (Partial) | Name | Position | Shareholding at period-end (shares) | | :--- | :--- | :--- | | Miao Jianmin | Chairman | – | | Wang Liang | Executive Director, President and CEO | 300,000 | | Zhong Desheng | Executive Director, Chief Risk Officer | 177,300 | | Peng Jiawen | Vice President, Chief Financial Officer, Board Secretary | 221,900 | | Lei Caihua | Vice President | 264,400 | | Xu Mingjie | Vice President | 200,000 | - In January 2025, Mr. Zhu Liwei's directorship qualification was approved by the National Financial Regulatory Administration; in March 2025, Mr. Huang Jian's directorship qualification was approved by the National Financial Regulatory Administration; in May 2025, Mr. Lei Caihua's vice president qualification was approved by the National Financial Regulatory Administration; in June 2025, Mr. Xu Mingjie's vice president qualification was approved by the National Financial Regulatory Administration; in February 2025, Mr. Zhang Jian ceased to serve as a non-executive director of the Company due to work changes; in March 2025, Mr. Chen Dong ceased to serve as a non-executive director of the Company due to work changes; in May 2025, Mr. Zhu Jiangtao ceased to serve as an executive director of the Company due to work reasons; in March 2025, Mr. Luo Sheng ceased to serve as a shareholder supervisor of the Company due to personal work reasons; in June 2025, Mr. Xu Zhengjun ceased to serve as an external supervisor of the Company due to the expiration of his term, and Ms. Cai Jin ceased to serve as an employee supervisor of the Company due to age reasons[320][321][322] - The Company has adopted the standards set out in Appendix C3 of the Hong Kong Listing Rules' Standard Code as the code of conduct for its directors and supervisors in securities transactions; after inquiry, to the best of the Company's knowledge, all directors and supervisors of the Company have complied with the Standard Code and the guidelines set by the Company during the reporting period[326] Interests and Short Positions of Directors, Supervisors, and Chief Executive under Hong Kong Regulations (Partial) | Name | Position | Share Class | Long/Short Position | Number of Shares (shares) | | :--- | :--- | :--- | :--- | :--- | | Wang Liang | Executive Director, President and CEO | A-share | Long Position | 300,000 | | Zhong Desheng | Executive Director, Chief Risk Officer | A-share | Long Position | 177,300 | | Yang Sheng | Employee Supervisor | A-share | Long Position | 197,700 | | Yang Sheng | Employee Supervisor | A-share | Spouse's Interest | 143,300 | 5.4 Profit Distribution The 2024 profit distribution plan, approved by the Shareholders' Meeting, includes appropriations for statutory surplus reserve, general reserve, country risk reserve, and public fund custody business risk reserve, along with a cash dividend of RMB 2.000 per share (tax inclusive) to all shareholders; the 2025 interim profit distribution plan targets a cash dividend amount representing 35% of the half-year net profit attributable to ordinary shareholders - The Company's 2024 Annual General Meeting, held on June 25, 2025, reviewed and approved the Company's 2024 profit distribution plan, including the appropriation of RMB 13.915 billion for statutory surplus reserve, RMB 13.323 billion for general reserve, RMB 0.022 billion for country risk reserve, and RMB 0.056 billion for public fund custody business risk reserve[328] - Based on the total share capital of A-shares and H-shares on the equity registration date for profit distribution, a cash dividend of RMB 2.000 per share (tax inclusive) will be distributed to all registered shareholders[328] - The Company's 2025 interim profit distribution plan is as follows: the cash dividend amount will account for 35% of the net profit attributable to the Bank's ordinary shareholders for the first half of 2025[329] 5.5 Employee Information As of June 30, 2025, the Group had 118,068 employees with a balanced gender ratio; the professional composition was primarily retail finance, and educational background mainly consisted of bachelor's degrees and master's degrees or above; R&D personnel numbered 10,782, accounting for 9.13% of the total workforce - As of June 30, 2025, the Group had a total of 118,068 employees (including dispatched personnel); the gender composition of the Group's employees was: 50,575 males and 67,493 females, indicating a relatively balanced gender ratio[330] - The professional composition of the Group's employees was: 20,584 in corporate finance, 52,813 in retail finance, 6,990 in risk management, 17,264 in operations and management, 10,782 in R&D, 1,091 in administrative support, and 8,544 in general management[330] - The educational background composition of the Group's employees was: 31,629 with master's degrees or above, 75,464 with bachelor's degrees, and 10,975 with junior college degrees or below[330] - The Group's R&D personnel numbered 10,782, accounting for 9.13% of the Group's total employees[330] 5.6 Head Office and Branches As of the end of the reporting period, the Company had 1,953 institutions across China and overseas, with total assets of RMB 11,799.728 billion; these institutions are primarily located in the Yangtze River Delta, Pearl River Delta and Western Taiwan Straits Economic Zone, and Bohai Rim regions Distribution and Asset Scale of Head Office and Branches (Partial, RMB million) | Regional Division | Number of Institutions | Asset Scale (RMB million) | | :--- | :--- | :--- | | Head Office | 3 | 5,931,820 | | Yangtze River Delta Region | 300 | 1,003,761 | | Bohai Rim Region | 384 | 917,885 | | Pearl River Delta and Western Taiwan Straits Economic Zone | 359 | 1,225,172 | | Northeast Region | 150 | 171,778 | | Central Region | 307 | 642,079 | | Western Region | 322 | 646,068 | | Overseas | 6 | 235,078 | | Total | 1,953 | 11,799,728 | 5.7 Compliance with Corporate Governance Code During the reporting period, the Company complied with the principles and code provisions of the Corporate Governance Code in Appendix C1 of the Hong Kong Listing Rules, and also met most of the recommended best practices - During the reporting period, the Company complied with the principles and code provisions contained in the Corporate Governance Code in Appendix C1 of the Hong Kong Listing Rules, and also met most of the recommended best practices[334] Chapter 6 Significant Matters This chapter addresses significant events and disclosures, including securities transactions, pena