As sales channels for wealth management products at large and medium-sized banks approach saturation, a strategic "downward expansion" into county-level markets is gaining momentum across the industry.
Since November, multiple wealth management subsidiaries—including ICBC Wealth Management, BOC Wealth Management, CITIC Wealth Management, and Jiangsu Bank Wealth Management—have announced new distribution partnerships exclusively targeting city and rural commercial banks in third-tier and lower cities. County markets are now the focal point of competition.
This year marks a shift from sporadic trials to systematic implementation of this expansion strategy. CITIC Wealth Management recently disclosed agreements with eight regional banks, such as Jiangsu Peixian Rural Commercial Bank and Jiangsu Yizheng Rural Commercial Bank, with Jiangsu Province as its primary expansion zone.
On November 13, Xingyin Wealth Management added Guangxi Jinxiu Rural Commercial Bank as a partner. Jiangsu Bank Wealth Management also extended collaborations to county markets in Ningbo, Quzhou, Wenzhou, and Shaoxing, Zhejiang.
Notably, even state-owned giants like ICBC Wealth Management and BOC Wealth Management are accelerating partnerships with smaller banks. ICBC Wealth signed with Huishang Bank on November 11, while BOC Wealth added Henan Rural Commercial Bank and Shaanxi Xianyang Rural Commercial Bank to its network, deepening penetration in Henan and Shaanxi.
Industry data supports this trend. The China Banking Wealth Management Market Quarterly Report (Q3 2025) shows 31 wealth management subsidiaries have established cross-bank distribution channels. By September 2025, 583 institutions were distributing their products—35 more than the previous year.
For smaller banks without wealth management licenses, distributing products from larger subsidiaries has become a critical revenue stream amid regulatory pressures. Financial authorities have mandated that city/rural commercial banks without dedicated wealth units must phase out self-managed products by end-2026.
The newly implemented Commercial Bank Agency Sales Business Management Measures (October 2025) further standardizes distribution practices. Analysts highlight mutual benefits: wealth managers gain localized client bases in underserved areas, while smaller banks offset narrowing interest margins with fee-based income.
"Distribution requires minimal capital, making it ideal for optimizing income structures," said Zhang Qiaochu, a Puyi Standards researcher. However, complete reliance on third-party products risks profit volatility and loss of autonomy. Some regional banks may retain limited self-managed offerings for differentiation, while others pursue their own wealth management licenses.
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