Hua Xia Bank (600015.SH) has undergone a major reshuffle in its core management, with three newly appointed "chief" executives taking center stage.
On October 23, the bank announced that former Chief Risk Officer Liu Xiaoli has been reassigned as Chief Operating Officer (COO). Fang Yi, former chairman of BOC Wealth Management, has assumed the role of Chief Risk Officer (CRO), while Liu Yue, head of the Asset-Liability Management Department, has been promoted to Chief Financial Officer (CFO). The restructuring reflects the bank’s strategic push to strengthen internal operations and risk controls.
The most notable change is the replacement of the Chief Risk Officer. Liu Xiaoli held the position for just nine months, while her successor, Fang Yi, served as BOC Wealth Management’s chairman for barely over two months. Market observers speculate whether the rapid turnover is linked to the bank receiving the largest regulatory fine in China’s banking sector this September.
On the same day, Hua Xia Bank released its Q3 2025 earnings report, revealing declines in both revenue and net profit. Revenue fell 8.79% year-on-year to RMB 64.88 billion, while net profit attributable to shareholders dropped 2.86% to RMB 17.98 billion. The bank attributed the declines to bond market volatility and narrowing interest margins.
**Leadership Reshuffle Raises Questions** Liu Xiaoli, born in April 1973, holds a master’s degree in economics. Before her brief tenure as CRO, she held key roles in risk management and credit approval at Hua Xia Bank. Her reassignment marks the bank’s first-ever COO appointment—a rare position among A-share listed banks.
Fang Yi, born in September 1980, previously spent years at Bank of Beijing (601169.SH) before his short-lived role at BOC Wealth Management. His appointment continues a trend of executives from Bank of Beijing joining Hua Xia Bank’s leadership, including Chairman Yang Shujian and Deputy President Tang Yiming.
**Regulatory Scrutiny and Compliance Challenges** Under Liu Xiaoli’s watch, Hua Xia Bank was fined RMB 87.25 million on September 5 for lax controls in loans, bills, interbank operations, and regulatory reporting. So far in 2025, the bank has received 11 penalties totaling RMB 99.07 million, far exceeding last year’s fines.
The bank stated it has taken corrective actions and held accountable personnel involved. However, the repeated violations suggest systemic weaknesses in compliance—a key responsibility for the CRO and Chief Compliance Officer (CCO).
Yang Hong, appointed as CCO on January 22, is tasked with aligning operations with China’s newly enforced *Financial Institution Compliance Management Measures*. Analysts note that effective collaboration between Fang Yi and Yang Hong will be critical to restoring regulatory confidence.
**Financial Performance Under Pressure** Hua Xia Bank’s net interest income fell 1.62% YoY to RMB 46.29 billion in Q3, reflecting persistent margin compression. The bank’s net interest margin stood at 1.55%, slightly above mid-tier levels among A-share lenders.
A sharp reversal in fair value adjustments (RMB -4.51 billion vs. RMB 3.33 billion gain in 2024) exacerbated revenue declines. Meanwhile, investment income—contributing nearly 20% of revenue—grew modestly at 3.61% to RMB 12.8 billion.
Asset quality remains a concern, with a non-performing loan ratio of 1.58%, the highest among China’s nine listed joint-stock banks. Provisions dipped to 149.33%, signaling reduced buffers against future risks.
As Hua Xia Bank navigates leadership transitions and operational reforms, its ability to balance growth with risk mitigation will be closely watched.
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