Guangdong Listed Rural Commercial Bank Industry Performance PK: Guangzhou Rural Commercial Bank Stops the Bleeding and Stabilizes, Dongguan Rural Commercial Bank’s Net Profit Declines for Three Consecutive Periods

Southern Finance reporter Pang Cheng intern Su Lei Guangzhou report

Recently, two Guangdong Hong Kong-listed banks—Guangzhou Rural Commercial Bank (01551.HK) and Dongguan Rural Commercial Bank (9889.HK)—successively released their 2025 performance announcements.

The announcements show that in 2025, Guangzhou Rural Commercial Bank achieved operating revenue of RMB 15.39B, down 2.79% year over year. Attributable net profit to shareholders was RMB 2.12B, up 1.98% year over year, ending the prior two consecutive quarters of decline, with performance showing signs of “bleeding control.”

In the same period, Dongguan Rural Commercial Bank achieved operating revenue of RMB 11.7B and attributable net profit of RMB 3.85B; year over year, operating revenue and attributable net profit decreased by 5% and 16.67%, respectively. The bank’s net profit has been declining year over year for 3 consecutive years.

Guangzhou Rural Commercial Bank and Dongguan Rural Commercial Bank are the only two listed local legal-entity banks in Guangdong. In June 2017, Guangzhou Rural Commercial Bank was officially listed on the Hong Kong Exchange main board, becoming the first listed local banking institution in Guangdong. In 2021, Dongguan Rural Commercial Bank successfully went public in Hong Kong, becoming the fourth rural commercial bank to list on the Hong Kong stock market.

Southern Finance reporter noted that, affected by factors such as the macro environment, the continued downward trend in market interest rates, and policy guidance encouraging financial institutions to provide more support to the real economy through financial concessions, the performance of the two listed banks has faced persistent pressure in recent years, with core indicators such as operating revenue and net profit almost retreating to levels prior to listing.

Expanding assets and balance sheet, with diverging returns

The performance announcements show that as of the end of 2025, Guangzhou Rural Commercial Bank’s total assets were RMB 1,380.008 billion, up RMB 17.6B from the beginning of the year, an increase of 1.29%, with growth slowing compared with the previous year. Dongguan Rural Commercial Bank’s total assets were RMB 796.02B, up RMB 50.11B year over year, an increase of 6.72%, achieving steady balance-sheet expansion.

Although asset scale is still expanding, the recovery of operating efficiency for the two banks shows clear divergence.

In 2025, Guangzhou Rural Commercial Bank achieved operating revenue of RMB 15.39B, down 2.79% year over year; net profit was RMB 2.46B, and attributable net profit to shareholders was RMB 2.12B, showing modest growth with increases of 2% and 1.98%, respectively. Compared with the sharp year-over-year declines in 2024 in operating revenue, net profit, and attributable net profit of 12.79%, 25.89%, and 21.02%, respectively, the industry’s performance has shown signs of “bleeding control.” The core reason is that the bank reduced provisions for credit impairment. In 2025, the bank’s credit impairment loss decreased by RMB 493 million year over year, a decline of 6.35%.

Dongguan Rural Commercial Bank’s operating pressure is even more pronounced. In 2025, it recorded operating revenue of RMB 11.7B, down 5% year over year; net profit was RMB 3.88B, down 20%; and attributable net profit to shareholders was RMB 3.85B, down 16.67%. Its net profit has fallen for three consecutive years.

However, when looking at a longer time horizon, the performance of both banks has nearly retreated to the level before listing.

Specifically, the pressure on the revenue side mainly comes from weaker net interest income. In 2025, Guangzhou Rural Commercial Bank’s net interest income was RMB 13.69B, up 0.54% year over year, staying basically stable, but the bank’s net interest margin further fell to 1.08%, down 3 basis points from 1.11% last year, continuing the downward trend.

By contrast, Dongguan Rural Commercial Bank’s pressure is more direct: in 2025, its net interest income was RMB 8.83B, down 3.78% year over year, and its net interest margin fell to 1.25%, down 0.10 percentage points year over year.

According to data from the National Financial Regulatory Administration, at the end of the fourth quarter of 2025, commercial banks’ net interest margin was 1.42%. This means that the net interest margins of the two banks above were both below the industry average, and their profitability still faces long-term pressure.

In addition to interest income, non-interest income was also hit by market volatility. Among them, increased volatility in the bond market in 2025 had a clear impact on mid-sized and small banks whose important investment allocation direction is bond investment.

Guangzhou Rural Commercial Bank’s non-interest income structure changed relatively significantly. In 2025, the bank achieved net fee and commission income of RMB 68.42B, up 21.84% year over year. The expansion of low-capital businesses showed some effectiveness. However, affected by market volatility, the bank’s net trading income shifted from positive returns in the prior year to a loss of about RMB 730 million, creating a clear drag on overall non-interest income.

Dongguan Rural Commercial Bank’s non-interest income also faced pressure. Its net non-interest income was RMB 2.87B, down RMB 268 million from the same period last year, a decline of 8.55% year over year. The main reasons were the reduction in fee rates for wealth management products and the rebound in bond interest rate volatility, which led to a year-over-year decrease in net trading gains.

Against this backdrop, the banks’ profitability performance further diverged. Guangzhou Rural Commercial Bank showed a trend of low-level recovery. In 2025, the bank’s net profit increased slightly by about 2% year over year. Its average return on total assets (ROA) remained at 0.18%, and its average return on equity (ROE) rebounded to 2.37%. Although the overall profitability level was still low within the industry, signs of marginal improvement began to appear.

By contrast, Dongguan Rural Commercial Bank’s net profit fell 20.24% year over year in 2025. Its average ROA dropped to 0.50%, and its average ROE fell to 6.18%, both down significantly from the prior year.

Pressure on corporate “ballast,” continued clearing

From the perspective of business structure, the corporate business remains the “ballast” for the performance of both rural commercial banks.

As of the end of 2025, Guangzhou Rural Commercial Bank’s corporate loan balance was RMB 518.03B, accounting for 73.37%. While maintaining its dominant position in corporate business, the bank continued to increase support for small and micro enterprises, technology finance, and green finance.

In particular, in recent years, Guangzhou Rural Commercial Bank has proposed developing “3+2” distinctive operation to optimize the asset-liability structure and enhance the core competitiveness of small- and medium-sized asset businesses. As of the end of 2025, the bank’s outstanding corporate loans for small- and medium-sized companies under RMB 50 million were RMB 68.22 billion, accounting for 16.3% of corporate loans; the number of small- and medium-sized corporate loan customers was 3,618, up 1,091 from the beginning of the year.

Dongguan Rural Commercial Bank, meanwhile, emphasizes its primary responsibilities of “supporting agriculture, supporting small businesses, and supporting real businesses,” and promotes coordinated development among four core business segments: corporate, retail, inclusive finance, and financial asset management.

However, in terms of loan allocation, the bank’s corporate loan scale was RMB 246.55B, accounting for 60.28%, up 1.35 percentage points from 58.93% the previous year. In terms of destination, its loan disbursement is highly concentrated in local real-economy businesses, with about 84.25% of loans distributed in the Dongguan region, and mainly to manufacturing customers.

From the perspective of asset quality, both banks stated in their performance announcements that, under the backdrop of a complex and changing external environment, they will continue to increase efforts to resolve risks and dispose of non-performing assets.

As of the end of 2025, Guangzhou Rural Commercial Bank’s balance of non-performing loans was RMB 13.1B, up RMB 1.15B from the previous year; its non-performing loan ratio was 1.86%, up 0.2 percentage points from the end of the previous year. The bank’s non-performing loans are mainly concentrated in wholesale and retail industries and manufacturing, accounting for 38.6% and 19.4%, respectively; non-performing loans in real estate account for only 7.9%.

By comparison, Dongguan Rural Commercial Bank’s non-performing loan indicators show “one up and one down.” The balance of non-performing loans was RMB 7.29B, up RMB 316 million from the end of the previous year; the non-performing loan ratio was 1.79%, after rising for four consecutive years it fell for the first time. Its non-performing loans are mainly concentrated in manufacturing, leasing, and commercial services, with the combined share exceeding one third. The bank’s allowance coverage ratio was 207.68%, the lowest level in the past six years.

On the secondary market performance, divergence between the two banks is also evident. Wind data shows that in 2025, Guangzhou Rural Commercial Bank’s share price fluctuated in the range of HK$1.36–HK$1.91. The total trading value for the year was only HK$8.7665 million. Average daily trading value was about HK$35k. Trading volume was zero on multiple trading days, and market attention was relatively low.

Dongguan Rural Commercial Bank’s trading activity was far higher than Guangzhou Rural Commercial Bank’s. In 2025, its share price fluctuated in the range of HK$3.16–HK$4.39. Total trading value for the year was HK$398 million, which is 45 times that of Guangzhou Rural Commercial Bank. Average daily trading value was about HK$1.59 million.

As of the close on April 1, Guangzhou Rural Commercial Bank closed at HK$1.54 and Dongguan Rural Commercial Bank at HK$3.46. Compared with their historical peak levels, the drawdowns were 78.90% and 58.81%, respectively. Their latest total market capitalizations were HK$35k and HK$22.19B, respectively.

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责任编辑：秦艺