As the year draws to a close and a new one begins, two seemingly unrelated events in the financial markets outline the strategic migration trajectory of Bank of Zhengzhou. On one hand, the bank won a lawsuit concerning a 1.1 billion yuan real estate loan for the Xitang project, but facing a defendant already deeply entrenched on the失信名单 (dishonest entities list), the creditor's rights are highly likely to become mere "paper wealth," with the bank frankly admitting it had "already provisioned for the loss." On the other hand, two of its village and township banks in Xun County and Yanling successively completed their transformation into sub-branches, marking a further deepening of its county-level layout. In this dance of retreat and advance, this city commercial bank rooted in Central China appears to be accelerating its extraction from the mire of property dependency, seeking new growth momentum in the county markets—a new blue ocean perceived to have stronger counter-cyclical capabilities.
The property sector legacy cast a long shadow. On the final day of 2025, the first-instance judgment from the Zhengzhou Intermediate Court in the 1.1 billion yuan financial loan dispute between Bank of Zhengzhou and Jinwei Industrial brought a conclusion to this conflict spanning several years. According to the judgment, defendant Jinwei Industrial is required to repay the principal and interest totaling 1.1 billion yuan within ten days (by January 10, 2026), with defendants Henan Zhongguang Urban Operations Management, Yongwei Properties, Cui Hongqi, Li Wei, and Li Lingling bearing joint liability for repayment. However, business registration information shows Jinwei Industrial has zero paid-in capital, its once core asset—the Xitang project—has been largely disposed of through the "保交楼" (ensure delivery) mechanism, leaving no executable assets, while guarantors Cui Hongqi and Li Wei are already deeply mired on the失信名单 (dishonest entities list). Despite securing a favorable judgment, Bank of Zhengzhou still faces the high probability of an awkward situation where "enforcement is impossible." The tragedy of the Xitang project is but one slice of Bank of Zhengzhou's non-performing property loans. In 2020, when the Zhengzhou property market still retained some warmth, Cui Hongqi, who possessed land resources from the old boiler factory site, joined forces with local developer Yongwei Properties. Through their jointly established Jinwei Industrial, they launched the "Yongwei Jinqiao Xitang" project. This popular residential project, adjacent to Zhengzhou University, once rapidly became the "pinnacle" of Zhengzhou's High-Tech Zone due to its superior location—until unexpected events struck abruptly. Just three months after Bank of Zhengzhou disbursed the 1.1 billion yuan loan, the project suddenly halted construction due to the alleged misappropriation of funds by the actual controller, Cui Hongqi. Subsequent government intervention in 2024 to ensure the project's completion under the "保交楼" initiative safeguarded homebuyers' rights but could not recover the funds for the bank, leaving Bank of Zhengzhou in the predicament of "winning the lawsuit but losing the money." While the loss from a single project might be absorbable, the bank faces the concentrated eruption of batches of non-performing property loans. In 2024 alone, the bank intensively exposed three major non-performing loans involving real estate, with the involved principal amount of 2.2 billion yuan already exceeding its net profit from the previous year, severely impacting its profit foundation. For instance, Xinyuan Property, under Henan's first US-listed developer Xinyuan Group, has an unsettled 1.1 billion yuan loan from Bank of Zhengzhou. Although the court ruled that Xinyuan Property must repay the principal and interest, by mid-2025, Xinyuan Group's total overdue debt had soared to 5.926 billion yuan, with a net loss of 1.433 billion yuan in the first half of the year, essentially rendering it incapable of repayment. The concentrated transmission of developer risks propelled a steep rise in Bank of Zhengzhou's non-performing loan ratio for corporate real estate. From 2019 to the first half of 2025, the bank's NPL ratio for real estate surged from 0.15% to 9.75%. To safeguard asset quality, Bank of Zhengzhou initiated a "de-property" transformation amidst the crisis. Firstly, it proactively scaled back the scale of property-related loans, gradually reducing the proportion of real estate loans from 13.62% at the end of 2019 to around 5%. Secondly, it actively addressed existing risks; while pursuing legal action against developers for debt recovery, it transferred an asset package with a book value of approximately 15 billion yuan to Zhongyuan Asset Management at a 34% discount in 2024, which included debts from several sued developers. By the end of the third quarter of 2025, the bank's overall NPL ratio was maintained at 1.76%, 8 basis points better than the average for city commercial banks. Behind the gradually stabilizing asset quality lies massive NPL write-offs. From 2022 to 2024, the bank's "write-offs and transfers" amounted to 4.69 billion yuan, 4.77 billion yuan, and 4.054 billion yuan respectively, significantly higher than previous levels. During the same period, profit growth rates were -24.92%, -23.62%, and 1.39% respectively; the overall profit of 1.876 billion yuan in 2024 was still less than that of ten years prior. The controversy over "no dividends for many years," triggered by shrinking profits and declining capital replenishment ability, sparked widespread discussion in the capital markets. Currently, the bank's overdue data still indicates pressure. By the end of the first half of 2025, overdue loans reached 21.09 billion yuan, a 135.38% increase from the end of 2020, with 7.77 billion yuan in loans overdue for more than one year still not classified as non-performing. Bank of Zhengzhou's Chairman, Zhao Fei, stated that future focus will emphasize internal risk control, starting primarily with credit risk, advancing modularly to build a comprehensive risk management framework that extends horizontally across all areas and vertically to the deepest levels.
Mired deeply in property sector troubles, Bank of Zhengzhou began turning its gaze towards the more promising county markets. After all, in a context of falling housing prices, asset depreciation, and significantly weakened consumer willingness, the下沉市场 (lower-tier markets) have indeed demonstrated stronger counter-cyclical capabilities compared to the urban economy. Looking back, Bank of Zhengzhou's focus on the county economy can be roughly divided into three phases. The initial attempt began in 2009, when the bank first started its institutional layout in counties under Zhengzhou's jurisdiction, establishing its first county sub-branch and first village and township bank, achieving full branch coverage across Zhengzhou's counties within the subsequent two years. In 2018, the bank further established a "Targeted Poverty Alleviation Leading Group," identifying the county financial market as a goal in its new five-year plan. Three years later, it set up a secondary department, the "Rural Finance Department," under the Retail Banking Department, moving county financial services towards specialization and systematization. However, from a strategic perspective, the bank still largely viewed counties as part of its inclusive finance and rural revitalization efforts at this stage, rather than a source for incremental growth, with limited resource investment in下沉市场 (lower-tier markets). It wasn't until the new leadership team took office in 2024 that a true turning point emerged. That year, Bank of Zhengzhou proposed the "County-led High-Quality Development Strategy," positioning the county economy as a "testing ground," "growth pole," and "incubator" for serving the regional economy, and decided to incubate various innovative products and institutional mechanisms within counties. This established the core status of counties within the bank, indicating their importance had surpassed the early practices of rural revitalization and inclusive finance. Observably, Bank of Zhengzhou's county business now operates on a dual-drive model of "retail + corporate." For instance, on the retail side, it expands its service boundaries through strategies like "entering online platforms, entering villages, entering communities." Strategically, its "乡村管家" (Rural Steward) concept has become one of the core tenets of its retail business, written into its "customer-centric" operating philosophy alongside services for citizens, financing, and wealth management. By optimizing rural service channels and enhancing service experience, it gradually forms the core competitiveness of its county finance operations. By the end of 2024, leveraging the "惠农站点+" (Benefiting Agriculture Stations+) scenario to penetrate deeper, the bank had developed acquiring merchants and enriched card usage environments, cumulatively issuing 258,500 rural revitalization cards, an increase of 86,600 from the end of the previous year. The corporate business focuses on "industrial finance + county economy," cultivating new growth poles through the "County-led Special Action." For example, it coordinates quarterly with the Provincial Financial Office and Provincial Development and Reform Commission to align with policies, formulating "one policy per location" based on local industrial characteristics, and reserves special credit quotas annually. Among these, Gongyi, as an industrially strong county, receives specialized support from Bank of Zhengzhou for traditional industry upgrades and major project construction. Jiyuan, bearing the development重任 (heavy responsibility) of Northwest Henan, receives financial support for regional coordinated development. Counties like Xingyang in the county economy sphere, and Zhongmu and Erqi, which focus on synergy between old and new urban areas, continue to utilize特色产品 (characteristic products) like the "乡村振兴贷" (Rural Revitalization Loan) to complement newly signed regions, collectively forming a financial service network covering all scenarios. Simultaneously, Bank of Zhengzhou plans to establish a high-quality talent development mechanism, encouraging young cadres to gain experience preferentially in county institutions, with priority promotion for outstanding performers. Profit distribution has also been adjusted accordingly; the new Chairman Zhao Fei承诺 (promised) that management compensation would be reduced by 10% for two consecutive years, with all freed-up resources倾斜 (tilted) towards the grassroots level. Observably, since 2025, Bank of Zhengzhou's credit resources have further shifted from property towards counties. By the end of the first three quarters of 2025, the bank's credit structure continued to optimize. Loans to the real estate industry shrank by nearly 7 billion yuan compared to the end of 2023, while loan growth in key areas like "三农" (Agriculture, Rural Areas, and Farmers) counties, manufacturing, and green finance already led the bank's overall growth rate. However, the migration path is by no means smooth. On one hand, the old wounds from the property sector have not fully healed, with the related NPL ratio experiencing a slight increase by the end of the first half of 2025 compared to the start of the year. On the other hand, while county finance is a blue ocean, its characteristics—such as high service costs and lack of credit data—place higher demands on banks'精细化运营 (refined operations) and risk pricing capabilities. As Bank of Zhengzhou seeks增量 (incremental growth) downwards, it must also face direct competition with institutions like local rural commercial banks. Whether the bank can completely escape the shadow of the property sector and gain acceleration in the county track remains to be tested by time.
