Revenue Decline and Retail Slowdown: Can Future Industries Take the Lead? CITIC Bank Performance Release Conference Detailed Explanation

On March 23, China CITIC Bank held its 2025 Annual Performance Release Conference. According to the bank’s performance report, last year CITIC Bank’s net profit attributable to the parent was 70.618 billion yuan, a year-on-year increase of 2.98%. However, operating income was 212.475 billion yuan, a decrease of 0.55% year-on-year.

Looking back at 2025, the bank’s net interest income decreased by 1.51% year-on-year, but non-interest income grew by 1.55%, and the non-performing loan ratio continued to decline.

Looking ahead to 2026, how will the bank develop? CITIC Bank Chairman Fang Heying stated at the release conference that the bank aims to increase revenue in capital market services, wealth management, and other areas.

Net interest margin decreased by 14 basis points, dragging net interest income into negative growth

In last year’s operating income, net interest income declined year-on-year, becoming a key factor in the bank’s profit decline. According to CITIC Bank’s performance report, the bank’s interest income was 284.588 billion yuan, down 25.203 billion yuan or 8.14% from the previous year; net interest income was 144.469 billion yuan, a decrease of 2.210 billion yuan or 1.51% year-on-year.

Data shows that CITIC Bank’s net interest margin last year was 1.63%, higher than the average of 1.56% for joint-stock banks, but it decreased by 14 basis points compared to the previous year, a larger decline than the 5 basis points average drop for joint-stock banks.

The reporter compiled and charted based on CITIC Bank’s performance report.

Fang Heying admitted at the conference, “Due to the narrowing of the net interest margin, CITIC Bank’s interest income decreased by 11.1 billion yuan.” The decline in net interest margin compared to peers was partly a deliberate choice and partly market-driven.

Fang explained that last year, CITIC Bank reduced some high-yield personal credit products, which affected the interest margin by 1.6 basis points. This was a proactive decision to balance future risk costs and current returns. Additionally, in the first quarter of last year, the bank held a relatively high proportion of low-yield bills, and although it began reducing these holdings at the end of the quarter, the impact had already occurred. Furthermore, due to insufficient refined management, the bank spent about 200 million yuan on interest for secondary capital bonds last year, which also caused fluctuations in the interest margin.

However, Fang also noted that CITIC Bank’s early control of liability costs helped release pressure on the net interest margin. Last year, the bank had about 40 billion yuan less in three-year-and-longer-term deposits compared to peers, which affected the cost of corporate liabilities by about 2 basis points and the interest margin by about 1 basis point.

According to the performance report, the bank’s interest expense on deposits last year was 89.506 billion yuan, down 14.469 billion yuan or 13.92% from the previous year, mainly due to a 0.37 percentage point decrease in the average cost rate of customer deposits, offset by an increase of 387.522 billion yuan in average balances.

Non-interest income takes the lead; growth in wealth management and agency business fees

In 2025, CITIC Bank’s non-interest net income became an important growth driver for the bank’s performance.

Data shows that last year, the bank’s non-interest net income was 68.006 billion yuan, an increase of 1.039 billion yuan or 1.55% year-on-year. Non-interest income accounted for 32.01%, up 0.67 percentage points from the previous year. Among them, net fee and commission income was 32.772 billion yuan, a rise of 5.58%, accounting for 15.42% of operating income, up 0.89 percentage points.

Fees from wealth management and agency services became the main contributors to the growth in fee and commission income. Wealth management fees increased by 1.909 billion yuan, a 45.17% rise; agency business fees increased by 1.234 billion yuan, a 24.77% increase.

The reporter compiled and charted based on CITIC Bank’s performance report.

CITIC Bank pointed out that the growth in agency business fees was mainly due to good growth in fund, insurance, and trust sales; the increase in wealth management fees was primarily driven by growth in wealth management income and scale.

“Currently, the market size for residents’ wealth management continues to expand, investor demands are changing, financial assets are becoming more diversified, and investment behaviors are becoming more rational,” said Xie Zhibin, Vice President of CITIC Bank. He added that to adapt to market changes, wealth management service models need to further transform into a buyer’s advisory role, marking a shift into a customer-centric value era.

In a low interest rate environment with declining deposit rates, developing wealth management is an important way for banks to increase customer stickiness and a key direction for lightweight development. Xie said CITIC Bank will continue to deepen high-quality customer acquisition, focus on value-driven management, and strengthen its investment research, production, and sales capabilities.

Additionally, due to the shrinking of overall market credit card transaction volume, CITIC Bank’s credit card fee and commission income decreased by 10.26% year-on-year in its various components.

Future industries like brain-computer interfaces will be a focus in 2026; retail business less attractive?

Looking ahead to 2026, Fang Heying stated at the performance conference that “corporate business will be the mainstay, with steady contributions from retail business.” The bank plans to increase revenue from capital market services, cross-border finance, investment trading capabilities, wealth management, risk mitigation, and collection efforts, as well as from new productive forces, new business models, and new markets. It also aims to enrich scenarios and ecosystems and increase contributions from subsidiaries.

Regarding asset allocation, Vice President Gu Lingyun said the bank will focus on key products in four major areas: technology finance, green finance, inclusive finance, and cross-border finance.

He pointed out, “In terms of industries, the bank will focus on the transformation and upgrading needs of traditional industries such as shipbuilding, steel, chemicals, and energy minerals; and increase investment in strategic emerging fields like integrated circuits and high-end equipment manufacturing.” Gu also mentioned that the bank will proactively explore future industries such as robotics, brain-computer interfaces, and 6G; and pay close attention to opportunities in industries related to aging, tourism, healthcare, and culture, supporting the commercialization and scale application of artificial intelligence, large-scale computing clusters, and new infrastructure projects like computing and energy collaboration.

Does focusing on corporate business mean retail is no longer attractive? Fang Heying responded that this does not mean retail is being downgraded, but rather “facing challenges head-on.” Currently, retail credit risk cycles are frequent, and retail banking must pay more attention to the development of wealth management markets.

According to CITIC Bank’s performance data, in 2025, non-performing loan formation was 66.315 billion yuan, an increase of 3.906 billion yuan year-on-year; the non-performing loan formation rate was 1.15%, up 0.04 percentage points, mainly due to macroeconomic factors and the transformation of the real estate market, leading to an increase in personal loan NPLs.

CITIC Bank Vice President and Chief Risk Officer Jin Xinian said that the overall risk level of CITIC Bank remains controllable. He predicted that with the implementation of policies to stabilize growth and promote consumption, as well as improvements in residents’ income and asset-liability restructuring, the bank’s retail asset quality will gradually stabilize and improve.