As the first national joint-stock commercial bank initiated by private capital, Minsheng Bank (600016.SH, 01988.HK) faces dual challenges in compliance and performance.
On October 31, China's National Financial Regulatory Administration issued fines totaling 215 million yuan against five banks, drawing significant market attention. Among them, Minsheng Bank was penalized 58.65 million yuan for imprudent management of loans, bills, interbank businesses, and non-compliant regulatory data reporting, with six responsible individuals fined 360,000 yuan collectively.
This marks Minsheng Bank's second eight-figure penalty in 2025, bringing its cumulative fines for the year to over 85 million yuan.
Beyond compliance issues, the bank's financial performance remains sluggish. In the first three quarters of 2025, Minsheng Bank reported operating income of 108.509 billion yuan, up 6.74% year-on-year, while net profit attributable to shareholders fell 6.38% to 28.542 billion yuan. Notably, this represents seven consecutive quarters of declining profits since Q1 2024.
By September 2025, the bank's total assets grew marginally by 0.74% to 7.87 trillion yuan, with total loans and advances declining by 13.721 billion yuan (-0.31%) to 4.44 trillion yuan. Meanwhile, its non-performing loan ratio climbed to 1.48%.
The recent regulatory action highlighted multiple violations across China's banking sector. Industrial and Commercial Bank of China received the heaviest penalty at 97.9 million yuan, while Minsheng Bank's fine ranked highest among joint-stock banks in this batch.
Earlier in January 2025, Minsheng Bank had been fined 17.055 million yuan for eight violations including account management breaches, anti-money laundering failures, and obstructing regulatory oversight. Additional million-yuan penalties followed throughout the year, including a 5.9 million yuan fine in September for inadequate system controls.
The bank's expansion has notably stalled. While net interest income grew 2.40% to 75.51 billion yuan in Q1-Q3 2025 with a slightly improved net interest margin of 1.42%, its loan portfolio shrank for two consecutive quarters. Corporate loans grew 1.58%, but personal loans dropped 3.17%. Deposits edged up just 0.15% to 4.26 trillion yuan, with corporate deposits falling 2.65%.
Management emphasized prioritizing deposit quality over quantity, stating short-term fluctuations wouldn't undermine operational resilience. Non-interest income showed strength, growing 18.20% to 32.999 billion yuan, driven by bond trading and fair value gains. However, a 28.17% increase in credit impairment provisions to 40.165 billion yuan weighed heavily on profits.
As of Q3 2025, the bank's NPL balance reached 65.857 billion yuan, with the coverage ratio improving slightly to 143.00%.
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