Net Profit Exceeds 7 Billion for the First Time, CITIC Bank's Dividend Finally Becomes More Generous

Question AI · How does CITIC Bank achieve revenue decline despite net profit growth?

Produced by | Damo Finance

After entering the “10 trillion yuan club,” CITIC Bank was the first to announce its 2025 performance report.

On March 20, CITIC Bank (601998.SH) released an announcement showing that in 2025, the bank achieved operating income of 212.475 billion yuan, a decrease of 0.55% from the previous year; net profit attributable to the parent was 70.618 billion yuan, an increase of 2.98% year-on-year.

The biggest highlight of CITIC Bank’s annual report is the stepwise leap in asset size. As of the end of 2025, CITIC Bank’s total assets reached 10.13 trillion yuan, a 6.28% increase from the end of the previous year. It is part of the “trillion-yuan echelon” along with China Merchants Bank, Industrial Bank, and Shanghai Pudong Development Bank.

Over the past five years, CITIC Bank’s total asset growth has been relatively stable. Although the growth rate has declined for four consecutive years, the overall change has been smooth, without large fluctuations. Moreover, after four consecutive declines in growth rate, the bank’s asset size growth rebounded again in 2025.

However, in terms of revenue performance, CITIC Bank’s performance is slightly weaker than the other three “trillion-yuan” joint-stock banks. According to previous performance quick reports, China Merchants Bank, Industrial Bank, and Shanghai Pudong Development Bank’s revenue growth rates in 2025 were 0.01%, 0.24%, and 1.88%, respectively, while CITIC Bank was the only one to decline.

In recent years, CITIC Bank has maintained a balanced, steady, and sustainable main tone, so the revenue decline is understandable.

Compared to revenue growth, CITIC Bank has achieved positive net profit growth for five consecutive years, which is relatively rare among joint-stock banks. Chairman Fang Heying also stated in the annual report that the bank’s net profit has achieved “three leaps” of 50 billion, 60 billion, and 70 billion yuan over five years, making it one of the few joint-stock banks to maintain five consecutive years of positive growth.

It is worth noting that CITIC Bank’s dividend payout in 2025 reached a new high. According to the profit distribution plan, CITIC Bank plans to pay a cash dividend of 1.93 yuan (including tax) per 10 shares, with a total annual cash dividend of 10.740 billion yuan; combined with the 10.461 billion yuan cash dividends already paid mid-year, the total payout for the year will be 21.201 billion yuan.

In fact, as a leading joint-stock bank, CITIC Bank’s dividend ratio is much weaker compared to China Merchants Bank. In recent years, China Merchants Bank’s annual cash dividend ratio has remained above 30%, while CITIC Bank has not reached 30% since 2017.

In 2025, CITIC Bank’s two cash dividends had a payout ratio of 30.02%, with both the dividend amount and ratio hitting a ten-year high, significantly increasing its attractiveness.

Net interest income slightly declines

Under CITIC Bank’s balanced, steady, and sustainable operating philosophy, 2025 again yielded a “profit increase without revenue increase” report card. This is also the fifth year within the past five years that revenue has declined, following a 2.6% decrease in 2023.

The growth in CITIC Bank’s net profit mainly relies on provisioning adjustments. In 2025, the bank made impairment provisions of 58.172 billion yuan, accounting for 27.38% of revenue.

From 2021 to 2024, impairment provisions as a percentage of revenue were 37.67%, 33.78%, 30.21%, and 28.6%, respectively. It can be seen that in an environment of continued narrowing of bank interest margins, reducing provisions to adjust profits has become an important means of stabilizing profits.

The persistent narrowing of interest margins was a common pressure faced by banks in 2025, and CITIC Bank was no exception. As of the end of 2025, CITIC Bank’s net interest margin was 1.63%, down 14 basis points from the end of the previous year. Last year, CITIC Bank’s net interest income was 144.469 billion yuan, down 1.51% year-on-year, while non-interest net income was 68.006 billion yuan, up 1.55%.

The two major net income figures moved roughly in the same direction, but since interest income is larger, the growth in non-interest income could not offset the decline in interest income.

Meanwhile, CITIC Bank is also cutting costs to ensure profit margins. In 2025, operating expenses were 128.801 billion yuan, a decrease of 2.95% year-on-year. Among them, business and management expenses were 67.159 billion yuan, down 2.251 billion yuan or 3.24%.

In terms of asset quality, CITIC Bank’s performance is commendable. As of the end of 2025, the non-performing loan ratio was 1.15%, down 0.01 percentage points from the end of 2024, marking seven consecutive years of decline.

Regarding CITIC Bank’s 2026 operating strategy, Fang Heying mentioned at the performance meeting that the bank will focus on restructuring, strengthening core advantages, emphasizing特色, and key areas.

On restructuring, CITIC Bank will continue to strengthen risk management concepts and strategies based on structure; on solidifying core advantages, it will further develop a new balance of volume and price supported by payment settlement and transaction services, consolidating the foundation for liability costs; on特色, it will leverage comprehensive financial services to amplify its competitive edge.

For key areas, the bank will focus on several business growth points that are strong, marketable, and high-value. Capital market services, cross-border finance, investment trading capabilities, wealth management, risk mitigation, and collection will be important sources of incremental growth.

Retail contribution profit sharply declines

Fang Heying stated at the performance meeting that CITIC Bank’s main development framework is “corporate takes the lead, retail maintains contribution, capital markets increase income, and risk control creates value.” However, retail banking still faces challenges.

In 2025, among CITIC Bank’s three main segments, corporate banking net income was 91.93 billion yuan, up 2.18%; financial markets net income was 28.059 billion yuan, up 4.95%. The only segment to decline was retail banking, with net income of 74.843 billion yuan, down 8.53%, making it the only segment to slide.

Although retail banking remains a key strategic focus, since 2022, pre-tax profits from retail banking have declined for four consecutive years.

From 2021 to 2024, pre-tax profits in retail banking were 22.704 billion, 17.380 billion, 15.935 billion, and 9.230 billion yuan, respectively.

In 2025, pre-tax profit in retail banking was 5.303 billion yuan, a 42.55% decrease year-on-year, and its share of total profit dropped sharply from 34.6% in 2021 to 6.3%.

Currently, domestic commercial banks are undergoing structural adjustments in retail business. Credit card operations, as a core segment, are also entering a phase of deep optimization. According to CITIC Bank’s disclosed data for 2025, its credit card business shows a “volume growth and quality adjustment” trend.

As of the end of 2025, the bank’s total credit card issuance reached 129 million cards, a 4.60% increase from the previous year-end; however, the related credit card loan balance was 462.117 billion yuan, down 5.28% year-on-year, indicating a contraction in overall assets.

In terms of transactions, CITIC Bank’s total credit card transaction volume was 2.18 trillion yuan, down 10.66% year-on-year; corresponding credit card business income was 47.749 billion yuan, a 14.60% decline. Since 2023, the transaction volume and revenue from credit cards have been declining for three consecutive years, highlighting industry growth pressure and the need for business transformation.

Compared to the overall decline in bad loans, personal loan delinquencies at CITIC Bank remain noteworthy. In 2025, the personal loan non-performing rate rose from 1.25% to 1.32%, with personal consumer loan delinquencies up 0.66 percentage points to 2.80%, and credit card delinquencies at 2.62%, up 0.12 percentage points.

The bank’s risk director, Jin Xinian, stated that since 2024, facing industry-wide risks in retail, the bank has adopted a risk joint prevention and control mechanism, strengthened full-process credit management, and continued to improve independent customer acquisition and risk control capabilities. The risk trend for key products is positive, and the bank is confident in quickly stabilizing retail asset quality.