Against the backdrop of a complex and severe macroeconomic environment and overall pressure across the banking sector, the "retail king" CM BANK (ASX: 03968) has released its third-quarter report.
The quarterly report shows that in the first three quarters of this year, CM BANK achieved operating revenue of 264.852 billion yuan, a year-on-year increase of 5.34%; it realized a net profit attributable to shareholders of the bank of 116.476 billion yuan, a year-on-year increase of 2.38%. On top of its massive asset base of 13.76 trillion yuan, CM BANK has still maintained a steady growth trajectory.
Through this third-quarter report, the outside world can also see three strategic arrangements that China Merchants Bank Co.,Ltd. (ASX: 600036) has adopted to cope with the current market environment: driving the net interest margin to bottom out and stabilize on the cost side, driving the explosion of the large wealth management matrix on the retail side, and safeguarding risk control on the asset side.
Net interest margin improves year-on-year and holds flat quarter-on-quarter
In recent years, affected by LPR cuts and insufficient effective credit demand, the banking industry's net interest margin has generally come under pressure. However, CM BANK's third-quarter report accomplished a "stabilization" of its interest margin.
The report shows that from January to September 2026, CM BANK's net interest spread was 1.76%, and its net interest margin (NIM) was 1.82%. More critically, in the single third quarter of 2026, both CM BANK's net interest spread and net interest margin held flat compared with the second quarter. In a channel where industry interest margins are generally declining, CM BANK being able to step on the "brake" first is truly not easy.
This is attributable to CM BANK's refined operations on both sides of assets and liabilities. On one hand, the cost ratio of liabilities steadily declined, with the annualized average cost ratio of interest-bearing liabilities falling to 1.04% in the first three quarters; on the other hand, CM BANK persisted in optimizing its asset structure, with the proportion of demand deposits showing a stabilizing trend (the daily average balance proportion reaching 49.75%), effectively offsetting the downward pressure on asset-side pricing and demonstrating extremely strong balance sheet management capabilities.
The "moat" of large wealth management widens
As CM BANK's core barrier, retail business and wealth management still maintained strong growth momentum in the third quarter.
As of the end of the reporting period, CM BANK's number of retail customers reached 236 million, and the balance of assets under management (AUM) for retail customers reached as high as 18,707.931 billion yuan, a sharp increase of 1.62 trillion yuan from the end of the previous year, with a growth rate of 9.52%. Among them, among high-net-worth customer groups, Golden Sunflower and above customers reached 6.5026 million households (+9.63%), and private banking customers approached 220,000 households (+10.10%). This indicates that during periods of macroeconomic fluctuation, high-net-worth individuals still regard CM BANK as a safe haven for wealth, and the "Matthew effect" is becoming increasingly pronounced.
The massive AUM directly translated into growth in non-interest income. In the first three quarters, CM BANK achieved non-interest net income of 95.473 billion yuan, a year-on-year increase of 4.48%. Among this, wealth management fees and commission income reached 23.504 billion yuan, a sharp year-on-year increase of 13.71%. It is worth mentioning that thanks to the increase in the scale and sales of equity funds, income from agency fund sales surged 31.63% year-on-year, and income from agency trust plan sales also jumped 32.27%. Amid market volatility, CM BANK once again proved the monetization capability of its large wealth management flywheel.
Real estate non-performing loan ratio drops sharply
In the area of risk prevention that the market closely watches, CM BANK has also seen improvement signals.
As of the end of September, CM BANK's non-performing loan ratio was 0.94%, flat compared with the end of the previous year, continuing to remain at a relatively low level in the industry; its provision coverage ratio was as high as 389.39%, and its risk compensation capacity remained ample.
What is noteworthy is the progress in resolving risks in the real estate sector. As of the end of the reporting period, CM BANK's non-performing loan ratio in the real estate industry fell to 3.89%, a sharp decline of 0.75 percentage points from the end of the previous year. Among its real estate development loans, more than 85% of the balance was distributed in first- and second-tier cities, and the regional structure was relatively sound. This indicates that CM BANK's earlier measures to manage and resolve real estate risks have yielded results, and the "gray rhino" of real estate-related risk is gradually receding.
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