Over 50% of Hong Kong Shareholders Oppose Chongqing Rural Commercial Bank's Charter Amendments

Chongqing Rural Commercial Bank (CRCB, 601077.SH) recently witnessed a rare scenario where over 50% of shareholders voted against key proposals.

On December 10, CRCB announced that four resolutions were passed at its 2025 first extraordinary general meeting. However, two proposals concerning corporate charter amendments faced opposition from more than 50% of participating H-shareholders.

The contested proposals involved revisions to the bank's Articles of Association and Board Meeting Rules. Specifically, 58.49% and 55.60% of H-shareholders voted against these amendments respectively, while other proposals saw minimal opposition (0.0114% and 0%).

Key changes in the Articles of Association included modifications to financial assistance provisions for share acquisitions, capital reduction requirements, and share transfer rules. The bank also introduced clauses allowing refusal of accounting record access if deemed potentially harmful. The Board Meeting Rules expanded director seats from 11-15 to 11-17 and removed restrictions on board secretary appointments.

Despite H-shareholder objections, both proposals passed due to overwhelming A-shareholder support. At the meeting, A-shares represented 83.40% of voting rights versus H-shares' 16.60%. The Articles amendment ultimately received 88.04% approval, while the Board Rules gained 89.10% support - both clearing the two-thirds threshold.

A CRCB representative acknowledged the H-shareholder scrutiny but couldn't specify their objections.

This incident reflects a broader trend of increasing shareholder dissent in Chinese banks. Recent examples include Zhengzhou Bank's 2023 profit distribution plan (83.1% H-share opposition) and Jiangyin Bank's regulatory revisions (nearly 10% opposition).

Industry experts attribute this trend to shifting bank profitability models amid interest rate declines and stricter asset classification. Li Jindi of Guangdong Genjihao International Certification noted that transparent voting channels and minimal dissent costs have made opposition more visible.

Legal experts emphasize that while H-shareholder votes rarely block proposals under current rules, high opposition ratios trigger disclosure requirements and potential regulatory scrutiny, creating indirect pressure for compromise.