Shanghai Pudong Development Bank (SPDB), once hailed as the "King of Corporate Banking," has faced a turbulent journey due to internal control issues. Now, its accelerated "village-to-branch" (VTB) restructuring has drawn market attention. As of December 10, the bank has absorbed over 10 rural banks across Liaoning, Yunnan, Chongqing, Zhejiang, and other regions, signaling a full-speed transformation.
In 2025, SPDB demonstrated its resolve for change—from converting rural banks to reporting rare revenue and net profit growth among A-share joint-stock banks in the first three quarters. However, challenges like capital adequacy pressure and lagging retail operations persist. Whether its VTB strategy can drive sustainable growth remains to be seen.
**VTB Restructuring Gains Momentum** SPDB has actively reformed its rural banking sector this year, absorbing institutions in Ningbo, Shaanxi (Hancheng and Fufeng), and others since July. These moves align with regulatory policies to mitigate risks and enhance operational efficiency under SPDB’s unified compliance framework. Analysts note that VTB integration addresses rural banks’ risk management gaps while expanding county-level services.
**A Turnaround in Performance** Founded in Shanghai and among the first A-share listed banks, SPDB’s reputation suffered after a 2017 scandal, leading to revenue and profit declines from 2021–2023. A leadership overhaul in 2024—with Zhang Weizhong as Chairman and Xie Wei as President—reinvigorated its corporate banking focus through digital transformation. By 2024, net profit rebounded to CNY 45.26 billion, with Q1–Q3 2025 showing 1.88% revenue growth and 10.21% net profit growth, the only joint-stock bank achieving dual growth.
**Persistent Challenges** Despite progress, SPDB’s core Tier-1 capital adequacy ratio dipped to 8.87%, nearing the 8% regulatory threshold. Non-interest income fell 1.34% YoY, while retail loan growth (2.84%) lagged corporate loans (6.38%). Rising retail NPLs (1.65% in H1 2025) further strained asset quality. Experts suggest diversifying into wealth management and green finance to bolster resilience amid interest rate cuts.
**Road Ahead** SPDB’s management must navigate capital replenishment, retail ecosystem upgrades, and digital integration to sustain growth. The bank has yet to comment on long-term strategies for VTB expansion or profitability.
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