Key takeaway

In 2025, Chongqing Rural Commercial Bank saw accelerated growth in both revenue and profit, slightly exceeding expectations. Benefiting from the Chengdu-Chongqing region's development beta, growth in loan scale remained strong. Leveraging its extensive branch network, the bank continued to focus on shortening the maturity of time deposits. Combined with the reduction in posted deposit rates, liability costs were further optimized, demonstrating strong resilience in net interest margin performance. Asset quality has improved, risk resilience has been further strengthened, the two major risks in real estate and urban investment have been largely resolved, while retail risks have become industry-wide exposures—subsequent trends still require close monitoring. The company maintains a stable dividend payout ratio, with minimal current capital pressure and low risk of refinancing dilution. The dividend yield is relatively high and solid, offering outstanding reward/risk for investment. We maintain "Buy"rating.

Event

On March 25, Chongqing Rural Commercial Bank released its 2025 annual report: The bank achieved operating revenue of RMB28.648 billion in 2025, representing a year-on-year increase of 1.4% (9M24: 0.7%), and net profit attributable to shareholders of RMB12.128 billion, up 5.3% year-on-year (9M24: 3.7%). The NPL ratio in Q4 2024 was 1.08%, down 4 bps quarter-on-quarter; the PCR in Q4 2024 increased by 2.4 percentage points quarter-on-quarter to 367.26%. The cash dividend payout ratio for 2025 is 30.7%, remaining unchanged from 2024.