Core Viewpoint - Despite industry challenges such as narrowing net interest margins and slowing profit growth, China Merchants Bank (CMB) reported a 0.25% increase in net profit for the first half of 2025, demonstrating operational resilience in a complex environment [2][4]. Financial Performance - CMB achieved operating income of 169.97 billion yuan in the first half of 2025, a year-on-year decrease of 1.72% [2]. - The bank's net profit attributable to shareholders reached 74.93 billion yuan, reflecting a slight increase of 0.25% year-on-year [2]. - The bank's return on assets (ROA) and return on equity (ROE) were 1.21% and 13.85%, respectively, both showing a decline compared to the previous year [4]. Revenue Structure - Net interest income for the first half was 106.09 billion yuan, up 1.57% year-on-year, while non-interest income was 63.84 billion yuan, down 6.77% [3]. - Wealth management income showed strong recovery, with "big wealth management income" increasing by 5.45% to 20.86 billion yuan, marking the highest growth rate in nearly three years [3][9]. Asset Quality - As of June 30, 2025, CMB's non-performing loan balance was 66.37 billion yuan, with a non-performing loan ratio of 0.93%, a slight decrease from the end of the previous year [5]. - The provision coverage ratio stood at 410.93%, down 1.05 percentage points from the end of the previous year [5]. Net Interest Margin - CMB's net interest margin was 1.88%, down 0.12 percentage points year-on-year, but still above the industry average by 46 basis points [6]. - The bank's average cost of customer deposits was 1.26%, significantly lower than the industry average [6]. Retail Business Resilience - CMB's total assets under management (AUM) for retail customers exceeded 16 trillion yuan, a 7.39% increase from the beginning of the year [9]. - Retail customer deposits reached 4.02 trillion yuan, up 4.99% from the end of the previous year [9]. - The number of retail customers grew to 216 million, a 2.86% increase year-on-year [10].

Core Viewpoint - The performance of listed banks in the first half of 2025 shows marginal improvement, with both revenue and profit returning to positive growth, indicating a positive trend in core revenue capacity [1][2]. Revenue and Profit Growth - In 1H25, listed banks' operating revenue increased by 1.03% year-on-year, reversing from negative growth, primarily due to a recovery in the bond market and improved non-interest income [2]. - The net interest income decreased by 1.3%, but the decline is narrowing, supported by reduced costs on the deposit side [2][3]. - The net profit attributable to shareholders of listed banks grew by 0.8% year-on-year in 1H25, with state-owned banks seeing a slight decrease of 0.13% [3]. Asset and Loan Growth - The total assets of listed banks grew by 9.6% year-on-year in 2Q25, with loans increasing by 8.0%, primarily driven by corporate loans [4]. - The proportion of corporate loans, retail loans, and bill discounts in the incremental loans for 1H25 were 84.6%, 13.0%, and 1.2%, respectively [4]. Deposit and Liability Trends - In 2Q25, the liabilities and deposits of listed banks grew by 9.6% and 8.4% year-on-year, respectively, with a slight decrease in the proportion of deposits to total liabilities [5]. - The trend towards more fixed-term deposits is slowing down, with the proportion of demand deposits decreasing slightly [5]. Net Interest Margin and Non-Interest Income - The net interest margin for listed banks decreased by 5 basis points to 1.48% in 2Q25, but is expected to stabilize as deposit costs continue to optimize [6]. - Non-interest income increased by 7% year-on-year in 1H25, with significant improvements in both fee income and other non-interest income [6][8]. Wealth Management and Other Non-Interest Income - Wealth management income for listed banks grew by 13% year-on-year in 1H25, marking the first positive growth since 2022, with state-owned and joint-stock banks showing significant improvements [7]. - Other non-interest income saw a year-on-year increase of 10.7% in 1H25, driven by improved market conditions and the realization of investment gains [8]. Asset Quality and Risk - The non-performing loan ratio remained stable at 1.23% in 2Q25, with a slight increase in the provision coverage ratio, indicating stable risk compensation capabilities [9]. - Risks in retail, credit card, and small micro-enterprise loans continue to be a concern, despite improvements in corporate loan quality [9]. Dividend Outlook - As of now, 24 banks are planning mid-year dividends for 2025, with 17 banks already announcing their plans, maintaining a stable dividend rate for major state-owned banks [10]. Future Outlook - The banking sector is expected to maintain stable growth in scale, with net interest margins likely to narrow due to lower interest rates [11]. - The performance of non-interest income is anticipated to continue improving, while asset quality remains a key focus area, particularly in retail and small micro-loan segments [11].