Leading the growth among state-owned banks! Live coverage of the Bank of Communications earnings call: 12.3 billion yuan in technology investment, AI mentioned 30 times in the annual report

On March 27, Bank of Communications released its 2025 annual report. The data shows that by the end of 2025, the bank’s total assets exceeded 15.5 trillion yuan, a growth of 4.35% compared to the end of the previous year, with both operating income and net profit attributable to shareholders growing by more than 2%.

In addition to Bank of Communications, on the evening of March 27, three other major state-owned banks, including Industrial and Commercial Bank of China, Postal Savings Bank of China, and China Construction Bank, also announced their 2025 performance. In a horizontal comparison, Bank of Communications outperformed the other three major state-owned banks in terms of revenue and net profit growth.

While maintaining stable growth in performance, Bank of Communications is also continuing to increase its dividend level. According to its 2025 profit distribution plan, the bank plans to distribute 14.88 billion yuan in cash dividends, combined with the previously distributed interim dividend, bringing the total dividend for 2025 to 28.692 billion yuan, with a cash dividend ratio of 32%.

At the performance press conference held that day, Zhang Baojiang, the vice chairman and president of Bank of Communications, stated that the bank always places high importance on investor returns. During the “14th Five-Year Plan” period, it has cumulatively allocated cash dividends of 123.9 billion yuan to all shareholders, maintaining a dividend payout ratio of over 30% for 14 consecutive years.

“The total amount of dividends for Bank of Communications in 2025 increased by nearly 2% compared to 2024, mainly due to our steady operational development and overall good performance, with continuous positive growth in net profit leading to an increase in distributable profit. In 2026, we are confident that we will continue to return value to shareholders with good performance and stable dividends,” said Zhang Baojiang.

Source: Bank of Communications performance presentation

Interest margin stabilizing, significant proportion of fixed deposits maturing in the first quarter

“In the face of continuously declining interest rates and insufficient effective demand, we adhere to the principle of ‘balancing volume and price with risk,’ strengthen internal management, seize external trending opportunities, and strive to address external uncertainty with certainty in our work. For the entire year, the four core indicators: net profit attributable to shareholders, net operating income, net interest income, and net fee and commission income all achieved positive growth, maintaining a stable and improving trend,” Zhang Baojiang stated in his address in the annual report of Bank of Communications.

Specifically, in 2025, Bank of Communications achieved operating income of 265.071 billion yuan, a year-on-year increase of 2.02%; it achieved net profit attributable to shareholders of 95.622 billion yuan, a year-on-year increase of 2.18%, equivalent to daily earnings of 262 million yuan.

Looking at the revenue structure, in 2025, Bank of Communications’ net interest income was 173.075 billion yuan, a year-on-year increase of 1.91%; non-interest net income was 91.996 billion yuan, a year-on-year increase of 2.22%, among which net fee and commission income was 38.183 billion yuan, a year-on-year increase of 3.44%. The income from wealth management, such as agency and asset management, grew well. The bank stated in its annual report that this was mainly due to its continuous deepening of wealth management features, with increased income from financial management and fund distribution.

Currently, the banking industry still faces pressure on interest margins. In 2025, Bank of Communications’ net interest margin was 1.20%, a year-on-year decrease of 7 basis points. The bank stated that this was mainly due to a significant decrease in asset-side yields, influenced by factors such as LPR cuts and fierce competition under weak demand; at the same time, the overall decline in market interest rates led to a 25 basis point decrease in securities investment yields.

Zhou Wanfeng, an executive director and vice president of Bank of Communications, stated at the performance meeting that since last year, the bank has made various efforts, and since the third quarter of last year, the interest margin has basically stabilized. With a large amount of fixed deposits maturing and being repriced, the cost of deposit interest will significantly decrease. “From Bank of Communications’ situation, the amount of fixed deposits maturing this year has significantly increased compared to last year, with a considerable proportion concentrated in the first quarter,” Zhou Wanfeng said.

Zhou Wanfeng stated that Bank of Communications will work hard in three areas to maintain a stable and improving interest margin: first, strictly manage the balance of loan and deposit volumes and prices; second, implement refined pricing management for loans and deposits, strictly adhering to self-discipline pricing mechanisms; third, scientifically optimize the arrangement of asset-liability structures.

Non-performing loan ratio drops for five consecutive quarters, reaching a nearly ten-year low

In terms of asset quality, as of the end of 2025, Bank of Communications had a non-performing loan balance of 116.983 billion yuan, an increase of 5.306 billion yuan from the end of the previous year, with a non-performing loan ratio of 1.28%, a decrease of 0.03 percentage points from the end of the previous year. The non-performing loan ratio has been decreasing for five consecutive years, reaching a nearly ten-year low.

Gu Bin, vice president of Bank of Communications, admitted at the performance meeting that the bank currently faces relatively significant asset quality pressure, particularly in the retail credit and small enterprise credit sectors, with the increase in non-performing loans in 2025 mainly coming from these areas.

The annual report of Bank of Communications shows that due to the macroeconomic environment and the downturn in the real estate market, the overall asset quality of retail credit in the domestic banking industry is under pressure. As of the end of 2025, the non-performing loan ratio for personal loans was 1.58%, which has increased compared to the end of the previous year, with the trend consistent with major peers.

Gu Bin stated that there will still be certain pressures on asset quality control this year. First, due to the impact of personal repayment capacity and declining market demand, it is expected that asset quality in retail credit and small enterprise credit will continue to be under pressure this year; second, the real estate market is still in a bottoming and stabilizing phase, with real estate risks continuing to be a focus; third, some industries face relatively homogeneous competition, leading to narrowed profit margins for enterprises and intensified operational differentiation. Bank of Communications will also continue to monitor the operational conditions and subsequent risk changes of enterprises in these industries.

Regarding asset control measures for retail credit business in 2026, Gu Bin stated that the bank will further integrate internal resources and strengthen the risk control capabilities of retail business by coordinating credit policy formulation, access control, post-loan monitoring and inspection, overdue collection, and the disposal of non-performing assets, transforming “passive firefighting” into “proactive reinforcement.”

“This year, we will carry out a special action for improving retail asset quality in 2026, adhering to a three-pronged approach of ‘clearing sludge, unblocking, and plugging leaks,’ and we have developed a series of measures to strive to quickly reverse the downward trend in retail credit asset quality,” Gu Bin emphasized.

Technology investment exceeds 10 billion for four consecutive years, significantly increasing “AI” content

In recent years, Bank of Communications has consistently maintained a large proportion of technology investment.

From 2022 to 2024, Bank of Communications invested 11.631 billion yuan, 12.027 billion yuan, and 11.433 billion yuan in financial technology, all remaining above 10 billion.

The latest data shows that in 2025, Bank of Communications’ investment in financial technology was 12.342 billion yuan, a year-on-year increase of 6.81%, accounting for 5.78% of operating income, an increase of 0.32 percentage points year-on-year. As of the end of 2025, the bank had 9,782 financial technology personnel, an increase of 8.20% from the end of the previous year, accounting for 9.99% of the total number of employees, an increase of 0.55 percentage points from the end of the previous year.

The Times Weekly reporter noted that compared to previous years, Bank of Communications mentioned “AI” and “artificial intelligence” significantly more frequently in the 2025 annual report, reaching 30 times, making it one of the key terms for the bank’s future development.

According to the annual report of Bank of Communications, the bank has implemented multiple AI application scenarios, such as new AI product interpretation and AI-assisted generation of investment research views in wealth management systems to meet the personalized asset allocation needs of a wide range of customers; using technologies such as AI to achieve online and automated processing of consumer protection review, complaint management, and financial education; and launching intelligent assistants to realize the application of AI agents in corporate electronic banking channels, enhancing customer experience and service efficiency.

Qian Bin, vice president and chief information officer of Bank of Communications, introduced at the performance meeting that during the “14th Five-Year Plan” period, the bank proposed to build a new card for artificial intelligence at Bank of Communications, making AI the core direction of digital development. In 2025, the bank further released the “Artificial Intelligence +” action plan to strengthen the foundation for the development of artificial intelligence.

“In 2025, Bank of Communications’ technology investment was 12.3 billion yuan, with a substantial proportion invested in the AI field. The scale of intelligent computing for the entire bank grew by over 50% compared to the previous year, and we have deployed over 2,500 AI intelligent assistants, achieving remarkable results in retail inclusiveness, risk credit, operational customer service, and other scenarios,” Qian Bin stated. Looking ahead, the bank will steadfastly implement the application of artificial intelligence as an important breakthrough direction in the “15th Five-Year Plan,” increasing resource investment, utilizing new quality productive forces to reduce costs, improve quality, and increase efficiency, achieving high-quality development.