


Core Viewpoint - China Merchants Bank reported a slight decline in revenue for the first half of 2025, but net profit showed a modest increase, indicating resilience in its financial performance amidst challenging market conditions [1]. Financial Performance - The bank achieved a revenue of 169.97 billion yuan in 1H25, a year-on-year decrease of 1.7%, with the decline narrowing by 1.4 percentage points compared to 1Q25 [1]. - The net profit attributable to shareholders reached 74.93 billion yuan, reflecting a year-on-year growth of 0.3%, with an increase of 2.3 percentage points from 1Q25 [1]. Interest and Non-Interest Income - Net interest income remained stable, amounting to 106.09 billion yuan in 1H25, representing a year-on-year increase of 1.6% [1]. - The decline in non-interest income has slowed, indicating improved performance in this segment [1]. Loan Growth and Quality - The loan balance at the end of 1H25 was 7,116.6 billion yuan, showing a year-on-year growth of 5.5%, slightly down from 5.8% at the end of 2024 [1]. - Corporate loans experienced a significant increase, rising by 11.5% year-on-year to 3,089.7 billion yuan [1]. - The non-performing loan (NPL) ratio at the end of 1H25 was 0.93%, stable compared to 1Q25, with corporate NPLs improving by 13 basis points from the end of the previous year [1]. Interest Margin and Cost Management - The net interest margin stood at 1.88%, down 12 basis points year-on-year, but the decline was less severe than the 17 basis points drop in 2024 [1]. - The bank is optimizing its funding costs, which is contributing to the stabilization of its interest margin [1]. Investment Strategy - The bank is deepening its wealth management strategy, with rapid growth in retail assets under management (AUM) and a solid competitive position in retail banking [1]. - With the expected recovery in economic growth, the bank's performance is anticipated to improve, maintaining a "recommended" rating for investment [1].