China Merchants Bank . Stock Earnings Reports

China Merchants Bank (CMB) reported largely stable 3Q25 results with modest revenue pressure but resilient profitability and asset quality. Key points: (1) Financial performance — Group net operating income was RMB 251.28bn (‑0.52% YoY) and net profit attributable to shareholders was RMB 113.7bn (+0.52% YoY). ROAA 1.22% and ROAE 13.96%; cost-to-income ~29.9%. (2) Balance sheet — Total assets RMB 12.64tn (+~4% vs. year‑end); loans RMB 7.14tn (+3.6% YoY) with retail loans 51.8% of loans; customer deposits RMB 9.52tn (+4.6%). (3) Margin & funding — NII RMB 160.04bn (+1.7% YoY); NIM 1.87% (‑12bps YoY). Liability costs fell materially (interest‑bearing liability cost 1.31%, customer deposit cost 1.22%), preserving NII despite retail loan pricing pressure. (4) Fee income & wealth — Net fee & commission RMB 56.2bn (+0.9% YoY) — first positive YoY since 2022; retail AUM RMB 16.6tn (+11% YTD) and wealth management revenues improving. (5) Asset quality & provisions — NPL ratio 0.94% (slightly down); NPL formation trending lower; annualized credit cost 0.67%; provision coverage remains high (~406%). (6) Capital & RWAs — CET1 13.93% (advanced approach); overall capital ratios declined vs. year‑end driven by faster RWA growth (structural shift to higher‑risk corporate/interbank assets and trading holdings) and OCI volatility. Management message: maintain a value‑creation, balanced strategy prioritizing asset quality, prudent pricing (no lowering of standards to chase volume), continued focus on retail and wealth, international expansion and disciplined capital/resource allocation. Risks: continued retail loan demand weakness, potential further pressure on NIM if LPR or demand weakens, RWA and capital volatility related to business mix and markets.