Core Viewpoint - The adjustment of credit card business by Guangfa Bank reflects a broader trend in the banking industry, where many banks are discontinuing co-branded credit cards and shifting focus from quantity to quality in their credit card offerings [1][4]. Group 1: Business Adjustments - Guangfa Bank will stop issuing five co-branded credit cards starting February 1, 2026, and will further discontinue several proprietary products on February 11, 2026 [1][2]. - This trend is not isolated to Guangfa Bank; multiple banks, including major state-owned banks and smaller institutions, have announced similar discontinuations of co-branded credit cards since 2025 [2][4]. - For instance, Pudong Development Bank ceased issuing 18 credit card products due to business strategy adjustments, and Wuhan Rural Commercial Bank announced the termination of its co-branded credit card with Taopiaopiao and Damai [2]. Group 2: Industry Trends - As of the third quarter of 2025, the total number of credit cards and loan cards in China was 707 million, marking a continuous decline over 12 consecutive quarters [3]. - The phenomenon of "new card promotion followed by card cancellations" has been prevalent, with co-branded cards being particularly affected as their appeal diminishes when associated IPs lose popularity [4]. - The credit card industry is undergoing a period of intense competition, prompting banks to focus on product innovation and operational efficiency to retain customers [4][8]. Group 3: Sustainable Development - The closure of credit card centers is a significant adjustment within financial institutions, with over 60 credit card centers shutting down since 2025 [6][7]. - The banking sector is actively reducing non-performing loans, with a reported balance of 3.5 trillion yuan in non-performing loans as of the third quarter of 2025, an increase of 88.3 billion yuan from the previous quarter [8]. - To achieve sustainable development, credit card institutions must prioritize product innovation, application scenarios, and asset quality, transitioning from a focus on acquiring new customers to enhancing existing customer value [8].

Core Viewpoint - The credit card business in China is undergoing significant adjustments, with many banks, including Guangfa Bank, halting the issuance of various co-branded credit cards, indicating a shift from quantity-focused strategies to quality-driven approaches in the industry [1][2][3]. Group 1: Credit Card Business Adjustments - Guangfa Bank officially launched a new round of credit card business adjustments in February 2026, ceasing the issuance of five co-branded credit cards starting February 1, 2026, and further discontinuing several proprietary products on February 11, 2026 [1]. - The trend of discontinuing co-branded credit cards is not isolated to Guangfa Bank; multiple banks, including major state-owned banks and smaller institutions, have announced similar actions since 2025 [2]. - As of the third quarter of 2025, the total number of credit cards and loan cards in China reached 707 million, marking a continuous decline over 12 consecutive quarters [3]. Group 2: Industry Trends and Insights - The observed trend of "active card issuance but declining card cancellations" has been prevalent, with co-branded cards being particularly affected due to their reliance on specific IPs and events, which lose appeal over time [3]. - The credit card industry is entering a phase of meticulous refinement, with banks focusing on product innovation and operational strategies to enhance customer retention and acquisition [4]. - Since 2025, over 60 credit card centers have been closed, reflecting a broader "inventory reduction" trend within the industry, as banks aim to reduce non-performing loans [4]. Group 3: Strategic Shifts in Credit Card Operations - The shift in focus from quantity to quality in credit card issuance is evident, with banks now prioritizing value contribution and sustainable development in their credit card operations [4]. - The integration of retail banking services, including savings, investments, loans, and credit cards, is becoming increasingly common, enhancing the overall financial service quality for high-end clients [4]. - Credit card institutions are encouraged to strengthen their online platforms and service capabilities, creating an integrated operational system that combines cards, mobile applications, scenarios, and benefits to drive growth and customer engagement [5].

Core Viewpoint - The credit card industry in China has experienced a significant contraction over the past three years, with a total reduction of nearly 100 million cards, indicating a shift from expansion to quality optimization in credit card business [2][3]. Group 1: Credit Card Quantity and Trends - As of September 2025, the total number of credit cards in China has decreased to 707 million, down from a peak of 807 million in September 2022, marking a continuous decline for 12 consecutive quarters [3]. - The decline in credit card issuance is attributed to stricter regulatory oversight, which has shifted the focus from quantity metrics to quality metrics in evaluating banks' credit card operations [3]. - Major banks have accelerated the cleanup of "sleeping credit cards," defined as those with no active transactions for over 18 months, in response to regulatory requirements [3]. Group 2: Performance of Major Banks - In the first half of 2025, several major state-owned banks, including Bank of Communications, Industrial and Commercial Bank of China, and China Construction Bank, reported a year-on-year decline in credit card issuance, with reductions of approximately 4.79 million, 4 million, and 2 million cards, respectively [4]. - Conversely, some banks like Citic Bank and Bank of China have seen growth in credit card issuance, with Citic Bank increasing by about 6.37 million cards [4]. Group 3: Closure of Credit Card Centers - A total of 63 credit card centers have ceased operations in 2025, including significant closures by Bank of Communications, which shut down 56 centers in major cities [5][6]. - The closures reflect a strategic shift in banks' operations, moving from centralized credit card management to localized branch management to better serve customers [7]. Group 4: Credit Card Loan Performance - The total transaction amount using credit cards has decreased, with major banks reporting declines in credit card consumption amounts, such as China Merchants Bank's credit card consumption dropping by approximately 188.8 billion yuan year-on-year [8][9]. - The credit card overdue loan balance has also seen a decline in several joint-stock banks, indicating pressure on retail assets [8][9]. Group 5: Asset Quality and Risk - The credit card non-performing loan (NPL) ratio has increased for several banks, with Industrial and Commercial Bank of China reporting an NPL ratio of 3.75%, up 0.72 percentage points year-on-year [9]. - The overall retail loan risk is becoming more apparent, with rising NPL ratios in credit card loans, although the rate of increase appears to be slowing [9].

Core Viewpoint - A major state-owned bank in China, specifically the Bank of China, is piloting a new policy to include litigation fees related to overdue credit card payments in the account statements of affected credit card holders, set to take effect on September 14, 2025 [1] Group 1: Policy Implementation - The Bank of China plans to incorporate various litigation-related fees into the credit card bills of cardholders who have overdue payments, which may include over ten types of fees such as litigation fees, arbitration fees, property preservation fees, travel expenses, execution fees, evaluation fees, auction fees, notarization fees, delivery fees, announcement fees, and attorney fees [1] - The bank will charge these fees based on judicial or arbitration decisions, either individually or as a total sum when multiple fees are involved [1] - Interest and penalties will not be applied to these fees [1] Group 2: Pilot Program - The implementation will initially take place in Shanghai as a pilot program before being gradually expanded to other regions [1]