Minsheng Bank 2025 Annual Report Released: Net Interest Margin Rarely Rises, Profit Turning Point Still Awaited

Minsheng Bank’s 2025 annual report has captured the attention of many investors, and once the actual performance figures were released, institutions are expected to “find it mentally taxing” again.

The annual report shows that the bank’s revenue for the full year was RMB 142.865 billion, up 4.82% year on year; net profit attributable to the bank’s shareholders was RMB 30.563 billion, down 5.37% year on year. The key revenue and net profit indicators of “one up and one down” highlight the bank’s distinct feature of still being in the midst of a business transformation.

However, although it is “higher revenue without higher profit,” fundamentally this still stems from the bank’s proactive efforts to step up risk resolution and increase asset impairment provisions. Reflected in asset quality, its nonperforming corporate real estate loan balance and nonperforming loan ratio achieved a notable “double decline,” with historical risks accelerated out of the system, laying the groundwork for future earnings stabilization and upward momentum.

Another noteworthy point is that Minsheng Bank’s net interest margin in its annual report edged up against the trend by 1 BP to 1.40%. The improvement is undoubtedly helped by a sharp 40 BP reduction in the deposit interest cost rate, but it is indeed a rare achievement among peers.

Why “revenue grows” without “profit growing”

In 2025, Minsheng Bank achieved operating income of RMB 142.865 billion, up 4.82% year on year; but net profit attributable to the bank’s shareholders was RMB 30.563 billion, down 5.37% year on year.

However, on closer analysis, the bank’s slight decline in profit is not caused by contraction in its core business, but by a significant increase in credit impairment losses—in other words, it is due to the proactive disposal of assets. In the reporting period, the bank’s credit impairment losses reached RMB 53.950 billion, up 18.64% year on year, showing management’s firm stance toward disposing of existing problem assets.

Net interest margin performance stands out

Worth noting is that the bank’s net interest margin rarely stabilized and rebounded. Against the backdrop of industry interest margins facing pressure across the board, Minsheng Bank’s 2025 net interest margin (NIM) was 1.40%, up slightly by 1 basis point (BP) year on year.

This above-expectation performance is mainly attributable to effective cost reduction on the liability side. By strictly implementing self-disciplinary requirements for deposits and refined pricing management, the bank’s full-year deposit interest cost rate fell sharply by 40 BP to 1.74%, successfully offsetting the pressure from a decline in asset-side yield.

Non-interest income performs strongly

Minsheng Bank’s annual report also shows a common feature shared by both joint-stock banks and state-owned big banks this year: non-interest is stronger than interest income.

In the reporting period, the bank’s net interest income was RMB 100.126 billion, up 1.46% year on year. Full-year interest expense on deposits decreased 17.28% year on year; the average cost ratios of corporate deposits and personal deposits fell by 41 BP and 38 BP, respectively. This “establish first, then break” strategy to optimize the liability structure is the core reason why its net interest margin can stabilize at 1.40%.

In addition, Minsheng Bank’s ability to achieve nearly 5% positive growth in revenue in 2025 is also driven by “strong non-interest.”

In 2025, Minsheng Bank achieved non-interest net income of RMB 42.739 billion, up 13.67% year on year, with its share of operating income rising to 29.92%. Among them, boosted by changes in capital market prices and increased bond trading, other non-interest income such as investment income reached RMB 24.418 billion, up 26.16% year on year, becoming a key engine pulling up revenue growth during the year.

A clear double decline in nonperforming loans

In terms of asset quality that the market is highly focused on, Minsheng Bank continued to adhere to the philosophy of operating with nonperforming assets and advanced risk resolution through multiple measures.

The financial report shows that in 2025, Minsheng Bank累计處置 nonperforming assets of RMB 72.004 billion in total, including disposals of nonperforming loans of RMB 67.390 billion.

By disposal method, cash recoveries were RMB 8.078 billion, transfers were RMB 11.605 billion, securitization of nonperforming assets was RMB 16.066 billion, write-offs of bad debts were RMB 30.293 billion, and disposals such as debt-to-asset settlements and other methods were RMB 1.348 billion; disposals of non-credit nonperforming assets were RMB 4.614 billion. It is precisely this large-scale cleanup and write-down that led to interim earnings pressure.

As of end-2025, the bank’s balance of nonperforming corporate real estate loans was reduced to RMB 11.736 billion; the nonperforming loan ratio fell significantly from 5.01% at the end of 2024 to 3.61%. The corporate nonperforming loan ratio declined by 0.02 percentage points to 1.24%. However, the ratio of personal nonperforming loans saw a slight increase: it rose by 0.12 percentage points to 1.92%, and in particular the nonperforming ratio of credit card delinquencies reached 3.87%, warranting attention.

A full-year dividend of RMB 8.3 billion

The bank plans to distribute cash dividends to A-share and H-share shareholders whose names are registered on the equity registration date. For fiscal year 2025, every 10 shares will receive a cash dividend of RMB 0.53 (including tax, same as below). Based on the bank’s issued shares of 43.782 billion as of December 31, 2025, the total cash dividends to be distributed will be RMB 2.320 billion.

Taking into account the interim dividend, Minsheng Bank’s total full-year dividend plan for 2025 will distribute cash dividends of RMB 8.274 billion in total, accounting for 30.14% of net profit attributable to ordinary shareholders.

In 2026, the bank plans to maintain the frequency of dividend payments, so as to convey a positive image to investors and the capital markets through a stable dividend policy and enhance investors’ sense of returns.

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