Core Viewpoint - Several medium and large banks in China are shutting down their independent mobile apps, indicating a shift towards consolidating services within fewer applications to enhance user experience and operational efficiency [1][5]. Group 1: Bank App Shutdowns - China Bank announced the discontinuation of its credit card app "Binfeng Life," with all functionalities migrating to the "China Bank" app [2]. - Beijing Bank stated that its direct banking app and website will cease operations on November 12, 2025, with services moving to the "Jingcai Life" mobile banking app [3]. - Over the past year, more than ten banks, including Postal Savings Bank and Beijing Rural Commercial Bank, have closed various mobile apps, primarily credit card and direct banking apps [5]. Group 2: Reasons for App Closures - The proliferation of independent banking apps was driven by competition for customer acquisition in the mobile internet era, leading to a situation where banks developed multiple apps [6]. - The existence of overlapping functionalities between direct banking and mobile banking apps has resulted in resource duplication and increased operational costs, negatively impacting user experience [7]. - Regulatory bodies have mandated banks to eliminate low-activity and high-risk apps, emphasizing the need for regular evaluation and optimization of mobile applications [8]. Group 3: User Engagement and Profitability Issues - Financial apps generally lack strong social attributes, leading to low monthly active user rates; for instance, the monthly active users of China Merchants Bank's credit card app dropped from 41.98 million at the end of 2023 to 39.08 million by mid-2024 [10]. - Many banks are integrating credit card and direct banking app functionalities into their main mobile banking apps to enhance efficiency and user experience [10]. - The direct banking model has faced challenges, including continuous losses, as exemplified by Postal Savings Bank's direct banking unit, which has struggled to meet market demands for comprehensive financial services [15][16].

Core Viewpoint - China Postal Savings Bank (Postal Bank) announced the absorption and merger of its wholly-owned subsidiary, Postal Huinong Bank, which will lead to the cancellation of the latter's independent legal status and the transfer of all its business, assets, and obligations to Postal Bank [2][8] Group 1: Merger Details - The merger will not affect the rights and obligations of Postal Huinong Bank's customers, and all existing contracts will remain valid [2][8] - Postal Huinong Bank's financial statements have been fully consolidated into Postal Bank's reports, indicating no substantial impact on Postal Bank's financial status or operational results [2][8][9] Group 2: Strategic Rationale - The merger aims to integrate Postal Huinong Bank's online operational experience into Postal Bank's broader development strategy, enhancing its online business capabilities [5][13] - The consolidation is expected to optimize resource allocation, inject new momentum into Postal Bank's development, and reduce management costs [13] Group 3: Industry Context - The merger reflects a broader trend in the banking industry towards digital transformation and the integration of direct banks into larger banking operations, as many banks have begun to merge or close their direct banking services [10][11] - The independent value of direct banks has diminished due to challenges such as product homogeneity and high customer acquisition costs, leading to a shift towards integrated banking services [11][12] Group 4: Performance Metrics - Since its establishment, Postal Huinong Bank has achieved significant growth, with total assets reaching 12 billion yuan and deposits growing at an annual rate of 120% [8]

Core Viewpoint - Postal Savings Bank of China (PSBC) announced the absorption and merger of its wholly-owned subsidiary, Postal Huinong Bank, to optimize management and business structure, resulting in the cancellation of the latter's independent legal status and the transfer of all its assets and liabilities to PSBC [1][4][5]. Group 1: Merger Details - The board of PSBC approved the merger proposal, which will be submitted to the shareholders' meeting and requires approval from the National Financial Regulatory Administration [5]. - The merger aims to enhance operational efficiency by integrating Postal Huinong Bank's online operational experience and resources into PSBC, thereby reducing management costs and improving overall operational efficiency [5][6]. Group 2: Postal Huinong Bank's Performance - Established in January 2022, Postal Huinong Bank had total assets of 12.005 billion yuan and over 20 million registered users by June 2023 [6]. - The bank reported a revenue of 150 million yuan in the first half of 2023, a year-on-year increase of 12.78%, while its net loss decreased by 38.74% compared to the previous year [6][7]. Group 3: Industry Context - Prior to the merger, there were only two independent legal direct banks in China, with the other being Citic Baixin Bank, which has a total asset of 119.516 billion yuan and a net profit of 472 million yuan as of June 2023 [8][9]. - The establishment of new independent direct banks has become increasingly challenging due to stricter regulatory policies and market saturation, leading to a trend of consolidation within the industry [9][10].

Core Viewpoint - Postal Savings Bank of China (PSBC) is set to absorb and merge its wholly-owned subsidiary, Postal Huinong Bank, to optimize management and business structure, leaving only Citic Baixin Bank as the sole independent direct bank in China [1][2][4] Group 1: Merger Details - The merger will result in the legal cancellation of Postal Huinong Bank's independent status, aimed at effectively utilizing resources and reducing operational costs for PSBC [2] - The integration of Postal Huinong Bank's online operational experience into PSBC is expected to enhance its online service capabilities and reduce management costs [2][3] - Postal Huinong Bank, established in January 2022 with a registered capital of 5 billion yuan, reported net profits of -162 million yuan, -263 million yuan, and -415 million yuan from 2022 to 2024, with a revenue of 150 million yuan and a net loss of -118 million yuan in the first half of 2025 [2][3] Group 2: Industry Context - The overlap in business scope between Postal Huinong Bank and PSBC includes public deposit acceptance, loan issuance, and financial bond issuance, indicating a high degree of redundancy [3] - The trend of direct banks is declining, with only a few remaining operational, as many banks are reducing their online channels and focusing on specific customer segments [4][5] - The current banking strategy emphasizes differentiation and the development of specific business segments rather than independent legal structures, with a shift towards integrated financial platforms and embedded service models [5]

Core Viewpoint - The direct banking model in China is experiencing a significant decline, with Beijing Bank announcing the migration of its direct banking services to its mobile banking app by June 25, 2025, effectively phasing out the standalone direct banking app [1][3][5]. Company Summary - Beijing Bank's direct banking service was launched on September 18, 2013, in collaboration with ING Group, marking the beginning of direct banking in China [3][4]. - The direct banking service saw rapid growth in its early years, with customer numbers reaching 246,000 and savings deposits amounting to 630 million yuan by the end of 2015, reflecting a 463.1% increase from the beginning of the year [4]. - By 2019, the last reported figures indicated that the direct banking customer base had grown to 476,000, with 60.7% being external customers, and cumulative sales reaching 11.56 billion yuan [4]. Industry Summary - The trend of shutting down or integrating direct banking services has been observed across the industry, with several banks, including Minsheng Bank and Hankou Bank, announcing similar actions [6][7]. - Industry experts suggest that the decline of direct banking is due to unclear positioning and overlapping functionalities with traditional banking services, leading to a decrease in customer engagement [7]. - As of now, fewer than 20 apps with "direct banking" in their names remain available, primarily from local banks and rural financial institutions [8].

Core Viewpoint - Baixin Bank, established in 2017, is a unique "direct bank" model that operates without physical branches, leveraging internet technology to provide banking services [1][2][3]. Group 1: Company Overview - Baixin Bank was jointly founded by CITIC Bank and Baidu's subsidiary, Baidu Borui, with a registered capital of 5.634 billion yuan [1][2]. - The bank's ownership structure includes CITIC Bank holding 65.79%, Baidu Borui 26.03%, and a Canadian pension fund 8.27% [2]. - As of the end of 2024, Baixin Bank had 999 employees, with 59.3% being technology personnel [4]. Group 2: Financial Performance - Total assets grew from 35.924 billion yuan in 2018 to 117.29 billion yuan in 2024, a 2.26 times increase over six years [7]. - Operating income increased from 1.295 billion yuan in 2018 to 4.626 billion yuan in 2024, a growth of 2.57 times [7]. - Net profit transitioned from a loss in 2018 to a profit of 855 million yuan in 2023, although it decreased to 652 million yuan in 2024 [7]. Group 3: Business Structure - Baixin Bank primarily focuses on personal and small micro-enterprise loans, with a significant portion of its loans being consumer loans [12][14]. - As of the end of 2024, over 80% of the bank's loans were consumer loans, totaling 64.291 billion yuan, while corporate loans were only 0.5 million yuan [14][15]. - The bank's business model resembles that of a consumer finance company rather than a traditional commercial bank [12][18]. Group 4: Asset Quality - The non-performing loan (NPL) ratio was 1.50% at the end of 2024, up from 1.36% in 2023, indicating increased asset quality pressure [16][18]. - The NPL coverage ratio decreased from 303.76% in 2023 to 264.69% in 2024, reflecting a decline in asset quality management [16]. - Despite the rising NPL ratio, Baixin Bank's 1.50% rate remains relatively low compared to industry peers [18]. Group 5: Strategic Challenges - The bank faces significant competition from traditional banks expanding their digital offerings and from other internet-based financial institutions [19]. - Maintaining stable business growth and finding ways to differentiate in a competitive landscape are critical challenges for Baixin Bank [19].

Core Viewpoint - The rise and fall of direct banks in China over the past decade reflects the challenges of digital transformation in the traditional banking sector, with many banks now integrating their direct banking services into mobile banking platforms due to changing consumer preferences and technological advancements [1][4][12]. Group 1: Development and Decline of Direct Banks - Direct banking in China began in 2013 with Beijing Bank, leading to a peak of 116 direct banks by 2019, but has since dwindled to around 20 by 2024 [1][3][6]. - Beijing Bank's direct banking customer base grew from 246,000 in 2015 to 476,000 in 2019, with cumulative sales reaching 11.56 billion yuan, but no further data has been disclosed since [1][2]. - Major banks have increasingly shut down or integrated their direct banking services into mobile banking apps, with Beijing Bank planning to migrate its direct banking services to its mobile app by June 2025 [2][3]. Group 2: Challenges Faced by Direct Banks - The decline of direct banks is attributed to the rise of mobile banking, which has improved user experience and functionality, rendering the independent existence of direct banks less valuable [4][10]. - Many customers remain unfamiliar with the concept of direct banks, leading to trust issues that hinder their growth [7][12]. - Direct banks often lack independent operational capabilities and face internal conflicts due to their positioning within traditional banking structures, limiting their ability to innovate and respond to market needs [9][11][12]. Group 3: Survival of Small and Regional Direct Banks - Smaller regional banks continue to operate direct banking services due to their resource constraints, which make the lightweight model of direct banks more suitable for their needs [5][8]. - These banks focus on localized customer bases and offer tailored financial products, allowing them to maintain a competitive edge despite the overall decline in direct banking [5][8]. Group 4: Future Prospects and Lessons Learned - The remaining direct banks may find success by refining their market positioning and collaborating with their parent banks to enhance service offerings [8][13]. - The experience of direct banks has highlighted the need for traditional banks to adapt to digital demands and has paved the way for the emergence of private and internet banks in the future [13].

Core Viewpoint - The announcement by Beijing Bank marks the end of an era for direct banks in China, as it plans to migrate its direct banking services to its "Jingcai Life" mobile banking app by June 25, 2025, leading to the discontinuation of the first direct banking channel in the country [1] Group 1: Industry Trends - The number of operational direct banking apps has decreased to fewer than 20, a significant drop from 135 at its peak in 2017, indicating an over 85% market elimination rate [1] - Direct banks were initially popular due to their convenience and low operational costs, but have faced challenges leading to their decline [2] Group 2: Historical Context - Beijing Bank launched the first direct bank in collaboration with ING Group in September 2013, during a time of rapid growth in internet finance, with direct banks seen as a key tool for digital transformation [2] - By 2015, Beijing Bank's direct banking customer base reached 246,000, with savings deposits increasing by 463.1% compared to the beginning of the year [2] - The last reported customer count for Beijing Bank's direct banking was 476,000 in 2019, with 60.7% being external customers, but this segment has since disappeared from annual reports [2] Group 3: Challenges Faced - The decline of direct banks is attributed to overlapping positioning and structural dependencies, leading to unclear development paths and customer confusion [3] - The distinction between direct banks and mobile banking has blurred, as mobile banking apps have integrated various services, resulting in significant product overlap [3][4] - Direct banks often lack independent management structures, being subordinate to traditional banks, which hampers their ability to innovate and compete effectively [4] Group 4: Future Outlook - The closure and integration of direct banking services are seen as a trend that will continue in the industry [6] - Remaining independent direct banks, such as Baixin Bank and YouHui WanJia, are exploring new development paths that differ from traditional departmental structures [6] - Baixin Bank, established in January 2017, aims to bridge traditional banking and internet enterprises, but has faced challenges, including a 23.74% decline in net profit in 2024 [6] - The evolution of direct banks serves as a lesson for commercial banks to explore a hybrid online-offline business model while maintaining a clear positioning and leveraging their strengths [6]

Core Viewpoint - The direct banking sector in China, once highly anticipated, is witnessing a significant decline, with major banks like Beijing Bank announcing the integration of their direct banking services into traditional mobile banking apps, marking the exit of the first direct bank [2][6]. Development of Direct Banks - The development of direct banks in China began in 2013, with Beijing Bank launching the first direct banking service, which was seen as a new era for the industry [4][5]. - At its peak, the number of direct banks exceeded 100, with city commercial banks and rural commercial banks being the primary participants [5]. Business Performance and Challenges - Beijing Bank's direct banking service saw rapid growth initially, with customer numbers reaching 476,000 by 2019 and total funds sold amounting to 11.56 billion yuan [6]. - However, since 2017, major state-owned and joint-stock banks have been adjusting their direct banking channels, leading to a trend of merging these services into mobile banking apps [6][8]. Market Dynamics - The number of operational direct banking apps has drastically reduced to about a dozen, primarily among smaller city and rural banks [2][8]. - Many direct banks have failed to establish a distinct market position, often serving merely as online extensions of traditional banking services, leading to a lack of competitive advantage [8][10]. Regulatory and Operational Constraints - The tightening of regulatory policies and the issue of product homogeneity have further restricted the growth potential of direct banks [9][10]. - Independent direct banks face significant challenges, including the need for complete operational independence from their parent banks, which complicates their ability to build profitable customer acquisition models [12][13]. Performance of Independent Direct Banks - Independent direct banks like Baixin Bank and Postal Savings Bank's Postal Huinong have not performed well, with Baixin Bank reporting a net profit decline of 23.74% in 2024 [12]. - The termination of the establishment of another independent direct bank,招商拓扑, highlights the difficulties in launching new entities in this space [13].

Group 1 - The direct banking model, which was once highly anticipated, is now witnessing a decline, with the first explorer, Beijing Bank, announcing the migration of its direct banking services to its mobile banking app by June 25, 2025 [2][4] - Currently, only a handful of local small and medium-sized banks operate direct banking apps, such as Hunan Bank and Tieling Bank, indicating a significant reduction in the number of active direct banks [5] - The direct banking model was first introduced by Beijing Bank on September 18, 2013, and by 2019, it had reached 476,000 customers with a cumulative sales amount of 11.56 billion yuan [5] Group 2 - The integration or shutdown of direct banking services is primarily attributed to the enhanced functionality of mobile banking apps, which now meet diverse user needs, diminishing the standalone value of direct banks [7] - The decline in internet traffic benefits and the rising customer acquisition costs have also posed challenges to the operational model of direct banks [7]