Following its largest penalty of the year, Hua Xia Bank is undergoing internal changes.
Liu Xiaoli, who was appointed Chief Risk Officer just nine months ago after regulatory approval in January, has transitioned to the role of Chief Operating Officer.
With a background as the Deputy General Manager of the Planning and Finance Department, General Manager of the Risk Management Department, and General Manager of the Credit Approval Department at Hua Xia Bank, Liu Xiaoli may have substantial experience in risk management compared to operations.
The new Chief Risk Officer, Fang Yi, comes from Bank of Beijing, where he had recently held the position of Chairman of Beiyin Wealth Management for less than three months. At 45 years old, Fang Yi's previous roles include Vice President of the Jinan Branch of Bank of Beijing, Deputy Director of the Bank’s Board (Supervisory Committee) Office, Deputy General Manager of the Investment Management Department, and President of the Shijiazhuang Branch.
Both Liu Xiaoli and Fang Yi have had relatively short tenures in their previous roles, indicating a rather sudden arrangement. This can be understood, as Yang Shujian, the Chairman of Hua Xia Bank, was formerly a veteran at Bank of Beijing and joined Hua Xia Bank only in March of this year. Yang may be more familiar with the management styles and capabilities of Bank of Beijing executives compared to long-time employees at Hua Xia Bank.
The Chief Risk Officer role, focusing on “reducing losses and enhancing benefits,” is currently critical for Hua Xia Bank. On September 5, the National Financial Regulatory Administration disclosed that Hua Xia Bank was fined 87.25 million yuan for mismanagement in related loans, bills, and interbank transactions, alongside non-compliance in regulatory data submissions, leading to warnings and fines totaling 200,000 yuan for responsible persons.
Effective risk management and compliance are increasingly important. As the leader, Yang Shujian primarily oversees Hua Xia Bank’s overall operational strategies and profitability.
According to the third-quarter report, Hua Xia Bank continues to face declines in revenue and net profit. For the first nine months of this year, the bank reported revenues of 64.881 billion yuan, down 8.79% year-on-year, and a net profit attributable to shareholders of 17.982 billion yuan, a decrease of 2.86% or 529 million yuan year-on-year.
Management attributed the decline in revenue for the first three quarters of 2025 primarily to fluctuations in the bond market, resulting in a year-on-year decrease in fair value change income, while net interest income remained stable. For the same period, net interest income was 46.294 billion yuan, a year-on-year decline of 1.62%.
Furthermore, the bank’s fair value changes swung from a gain of 3.326 billion yuan in the first three quarters of 2024 to a loss of 4.505 billion yuan in the first three quarters of 2025. In the third quarter alone for 2025, fair value changes amounted to -4.319 billion yuan.
As of September 30, 2025, Hua Xia Bank reported total assets of 4.586358 trillion yuan, reflecting a 4.80% increase from the end of the previous year. Total loans reached 2.435594 trillion yuan, a 2.93% increase, while total deposits were 2.33896 trillion yuan, representing an 8.72% increase, indicating deposit growth outpaced loan growth.
In terms of asset quality, as of the end of September, the bank's non-performing loan ratio stood at 1.58%, down 0.02 percentage points from the end of last year, with a provision coverage ratio at 149.33%, down 12.56 percentage points from the previous year's end. During the third-quarter earnings conference, President Qu Gang indicated that Hua Xia Bank had intensified efforts in handling non-performing loans, resulting in a slight decline in the provision coverage ratio compared to the end of the first half and the beginning of the year.
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