AGRICULTURAL BANK OF CHINA(SH:601288) Di Yi Cai Jing·2025-10-15 11:58Core Viewpoint - The recent approval of the integration of multiple rural commercial banks into Agricultural Bank of China in Jilin province marks a new phase in the reform of the rural financial system, showcasing an innovative model that leverages the strengths of large commercial banks in risk management and resource allocation [1][2][9]. Summary by Sections Agricultural Bank's Large-Scale Integration - The National Financial Supervision Administration's approval on October 12 allows the renaming of 102 rural commercial bank branches to Agricultural Bank branches, including 54 from Yanbian Rural Commercial Bank and 36 from Dunhua Rural Commercial Bank [2]. - In the past month, Agricultural Bank has integrated at least 190 rural commercial bank branches in Jilin, indicating a significant involvement in the reform of the rural financial system [2]. Background of Jilin's Financial Institutions - Jilin province has been focusing on risk management for small financial institutions, with a notable number of high-risk institutions identified in recent years [3]. - The newly established Jilin Rural Commercial Bank was formed by merging 13 local financial entities, aiming for a unified legal entity across the province [3]. Participation of State-Owned Banks in "Village to Branch" Reform - Agricultural Bank has also engaged in the "village to branch" reform by renaming several village banks to Agricultural Bank branches, with similar actions taken by other state-owned banks like ICBC and Bank of Communications [4][5]. - As of mid-2023, Agricultural Bank controls six village banks, indicating a strategic move to consolidate its presence in rural finance [5][6]. Implications of the New Model - The participation of large commercial banks in the reform of rural financial institutions is seen as a market-driven innovation that could enhance the stability and efficiency of the financial system [8][9]. - Experts suggest that while this model shows promise, its scalability will depend on regulatory guidance and the profitability considerations of state-owned banks [9][10].