Chongqing Bank Enters the Trillion-Yuan Club: Revenue and Net Profit Increase by Over 10%, Retail Non-Performing Loan Ratio Rises

Ask AI · What challenges does the rise in retail delinquency ratios pose to banks’ transformation strategies?

【By Yu Fan Guan Jin Studio】

On March 24, Chongqing Bank released its 2025 annual report. This bank is the first “A+H” listed city commercial bank in the west. It delivered a wrap-up answer sheet for the “14th Five-Year Plan” period: its total assets exceeded 1 trillion to reach 10,337.26 billion yuan, up **20.67%** year over year, becoming the first A+H listed city commercial bank nationwide to enter the trillion-yuan tier. As of now, city commercial banks with assets in the 1–2 trillion yuan range across the country also include Chengdu Bank, Changsha Bank, Zhongyuan Bank, Shengjing Bank, Xiamen International Bank, Chongqing Bank, among others.

Last year, Chongqing Bank achieved operating income of 15.113 billion yuan, **up 10.48%** year over year. Its net profit attributable to shareholders was 5.654 billion yuan, up 10.49%, with both revenue and profit delivering double-digit growth. Its net interest margin rebounded against the trend to 1.39%, its non-performing loan ratio fell to 1.14%, and asset quality continued to improve.

However, although the results look impressive, upon closer inspection of the detailed financial statements, issues such as pressure on retail business, a decline in non-interest income, and a drop in capital adequacy ratio have gradually emerged as well.

**Corporate loans surged by 30.95%, and the net interest margin rebounded against the trend to 1.39%** 

In 2025, Chongqing Bank’s core drivers of performance growth came from a strong expansion in corporate business and refined management on the liability side. This also became the key to stabilizing its net interest margin during an industry cycle of falling interest margins.

The annual report shows that as of the end of 2025, the bank’s total amount of loans and advances to customers was 531.285 billion yuan, up 20.58% year over year. Of this, corporate loans were 409.867 billion yuan, surging 30.95% year over year, and their share of total loans rose to 77.46%, increasing from 58.86% in 2021 by nearly 19 percentage points. The size, incremental growth, and growth rate of corporate loans all reached record highs.

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Looking at where corporate loans are directed, Chongqing Bank closely aligns with regional economic development strategies and focuses credit resources on major strategic areas such as the twin-city economic circle in the Chengdu-Chongqing area and the Western Land-Sea New Corridor. Throughout the year, it supported nearly 150 major projects for the development of the twin-city economic circle, with outstanding financing balances for the construction of the Western Land-Sea New Corridor exceeding 55 billion yuan. In terms of industry distribution, leasing and business services, as well as water conservancy, environmental affairs, and public facilities management, became the two main segments, accounting for 27.17% and 19.05%, respectively. Moreover, the non-performing loan ratios in both industries are kept below 1%. The non-performing rate for leasing and business services is only 0.31%. This layout of high-quality corporate assets not only supports growth in scale but also lays a foundation for stable asset quality.

On net interest margin, amid a backdrop where the yield on interest-earning assets across the banking industry generally declines, Chongqing Bank’s net interest margin rose from 1.35% in 2024 to 1.39%, halting the downward trend since 2022. Achieving this outcome owes more to efficient optimization on the liability side.

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According to data, in 2025 the bank’s average yield on interest-earning assets fell by 27 basis points from the previous year to 3.53%, but the average cost rate of interest-bearing liabilities declined even more—down 40 basis points year over year to 2.18%. Improvement on the liability side comes, on the one hand, from optimization of the deposit structure. As of the end of 2025, the bank’s total customer deposits were 565.704 billion yuan, up 19.32%. Among them, personal time deposits increased 24.12% year over year to 280.367 billion yuan, the share of savings deposits rose to 54.22% of total deposits, and the increased proportion of stable low-cost deposits effectively reduced liability costs. On the other hand, the bank proactively adjusts its liability structure. The proportion of market-based liabilities such as interbank liabilities is reasonably controlled, further lowering the overall cost of liabilities.

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Meanwhile, Chongqing Bank has continued to increase credit support for key areas of the real economy. Advanced manufacturing, technology-based enterprises, and green industries have become important directions for credit deployment. The outstanding balance of loans to technology-based enterprises grew by 60% over the year, and the scale of green credit increased by 40%. The incremental growth and growth rate of manufacturing loans both reached highs over the past five years. Through structural efforts in corporate business, it both aligns with the national direction of financial services supporting the real economy and allows the bank to achieve continuous optimization of its credit structure while expanding in scale. By the end of 2025, the proportion of general loans to the total principal amount of loans and advances was 95.74%, up 2.05 percentage points from the end of the previous year. The increased share of high-yield assets effectively offsets downward pressure on the yield of interest-earning assets.

**Retail non-performing loan ratio rises to 3.23%, and non-interest income falls by 24.24%** 

While its scale surpassed the trillion-yuan mark and performance grew steadily, Chongqing Bank also faces multiple challenges, including pressure on retail business, weak non-interest income, and a falling capital adequacy ratio. These problems have become important constraints on its strategic vision of becoming a “top-tier listed commercial bank in China,” and they also test the bank’s ability to strengthen and execute transformation initiatives going forward.

Retail business performance became one of the biggest weaknesses in the bank’s 2025 results. The annual report shows that as of the end of 2025, the bank’s retail loans were 96.702 billion yuan, down slightly by 0.94% year over year, and their share of total loans fell to 18.28%. Against the backdrop of a sharp growth in corporate loans, the lackluster growth in retail business is particularly prominent.

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In terms of the retail loan structure, both personal mortgage loans and operating loans declined to varying degrees. Although the bank has vigorously promoted its self-operated online consumer lending product “Jie e Loan,” with its balance exceeding 10 billion yuan, it still failed to reverse the overall downward trend in retail loans. Of even greater concern, the asset quality of the bank’s retail loan portfolio has come under clear pressure. As of the end of 2025, the **retail non-performing loan ratio rose to 3.23%**, up 0.52 percentage points from the end of the previous year. Looking at past data, non-performing loan rates for segments such as credit card overdrafts and personal operating loans had already been trending upward. In 2024, the non-performing ratio for credit card overdrafts rose from 1.99% to 3.04%, while the non-performing ratio for personal operating loans rose from 4.42% to 5.70%. With the rise in risk across retail business, the bank no longer discloses separately the non-performing conditions of all retail loan products. Addressing the risk in retail business and restoring business growth remain urgent issues.

The sharp decline in non-interest income reflects the lag in the development of the bank’s intermediary business, and it makes the problem of having a relatively single revenue mix even more prominent. In 2025, the bank recorded non-interest net income of 2.654 billion yuan, down 24.24% year over year. Of this, net fee and commission income was 0.598 billion yuan, down 32.66% year over year. Its share of operating income was only 3.95%, down sharply by 2.54 percentage points from 6.49% in 2024.

The decline in fee and commission income is mainly attributable to lower income from agency wealth management business. Over the full year, revenue from this business was 0.344 billion yuan, down 49.29% year over year. The bank explains that it was mainly affected by the low-interest-rate market cycle; the decline in the underlying assets’ yields led to a drop in wealth management fee income. Although payment settlement and agency business income grew by 14.71%, it was still unable to offset the decline in wealth management business. Losses from changes in fair value also widened to 0.83 billion yuan, down significantly by 871.95% year over year, further dragging down non-interest income performance. Against the backdrop of banks rolling out “light-asset” transformations and increasing the share of intermediary business income, Chongqing Bank’s weak non-interest income not only reduces its ability to withstand risks in revenue, but also runs counter to the direction of light-asset transformation.

A continued decline in the capital adequacy ratio has become the core bottleneck constraining the bank’s continued expansion in scale. As of the end of 2025, the bank’s core tier-one capital adequacy ratio, tier-one capital adequacy ratio, and capital adequacy ratio were 8.53%, 9.62%, and 12.55%, respectively—down 1.35, 1.58, and 1.91 percentage points from the end of the previous year. Although it still meets regulatory requirements, the magnitude of the decline is relatively significant.

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Regarding the decline in the capital adequacy ratio, the bank states that it was mainly due to the increase in total risk-weighted assets inside and outside the balance sheet driven by business development—up 20.83% year over year to 664.239 billion yuan—whose growth rate outpaced the pace of capital replenishment. In fact, Chongqing Bank’s high reliance on traditional interest-margin businesses makes its operations highly capital-consuming. At present, the bank’s capital replenishment channels are relatively single. The 13 billion yuan convertible bonds issued in 2022, as of the end of 2025, had cumulatively converted only 88 thousand yuan, with a conversion ratio of less than 0.01%, failing to effectively replenish core tier-one capital. As the bank’s asset scale continues to expand, capital consumption will increase further. If the bank cannot promptly broaden its capital replenishment channels, its capital adequacy ratio may continue to fall, thereby constraining its ability to deploy credit.