Net interest income of 12 listed banks increases year-on-year, supporting a rebound in performance

In recent years, due to factors such as the continued decline in loan interest rates and weak loan demand, the core component of commercial banks’ revenue structure—net interest income—has been under sustained pressure. As the effects of loan repricing are gradually released and the benefits of falling funding costs become apparent, in 2025, many listed banks saw year-over-year growth in net interest income, supporting a rebound in revenue growth.

According to Wind Information, as of the time of this release on April 7, 22 A-share listed banks have disclosed their 2025 annual reports, including 6 state-owned large banks, 9 joint-stock banks, and 3 city commercial banks and 4 rural commercial banks. Among them, 12 banks saw year-over-year growth in net interest income, helping stabilize performance.

Net interest income decline narrows

Data show that in 2025, these 22 listed banks together achieved total net interest income of 3.76 trillion yuan, a decrease of 34.1 billion yuan year over year, down 0.90%, continuing the overall downward trend in net interest income of listed banks in recent years. Even so, the combined net interest income year-over-year decline narrowed significantly, while this figure was 2.53% in 2024.

Looking further, among the 22 listed banks, 12 recorded year-over-year growth in net interest income; in 2024, only 6 of these 22 banks had year-over-year growth in net interest income. Specifically, in 2025, China Merchants Bank’s net interest income exceeded 200 billion yuan; the net interest income of Pudong Development Bank and China Minsheng Bank each exceeded 100 billion yuan; the largest year-over-year increase in net interest income was at Chongqing Bank, reaching 22.44%. In addition, the growth rates for Pudong Development Bank, Qingdao Bank, Chongqing Rural Commercial Bank, and others were also above 5%.

By reviewing the annual reports of relevant listed banks, it can be seen that with no obvious change in the trend of declining return on assets, listed banks have generally increased efforts to lower funding costs, creating room for the rebound in net interest income and further driving a rise in overall revenue.

For example, China Merchants Bank’s 2025 annual report shows that in 2025, the bank achieved operating income of 37.6k yuan, up 0.01% year over year. Among that, non-interest net income fell 3.38% year over year to 337.53B yuan, while net interest income increased 2.04% year over year to 121.94B yuan, pulling the revenue growth rate back into positive territory. In 2024, the bank’s operating income fell 0.48% year over year.

“This indicates that banks’ profitability is being repaired, sending a positive signal that the marginal pressure on bank operations is easing,” said Lou Feipeng, a researcher at Postal Savings Bank of China, to reporters of The Securities Daily. “This is mainly due to: first, the stabilization and rebound in the macroeconomy, which drives the recovery of credit demand and steady expansion of banks’ asset scale; second, the effectiveness of funding cost optimization, with the positive effect of lower deposit rates gradually becoming visible; and third, banks proactively adjust their asset structure and increase allocations to high-yield assets.”

Net interest margin expected to stabilize and turn for the better

Recently, management personnel from multiple state-owned large banks and joint-stock banks, during their 2025 results briefings, said that the net interest margin of the banks they oversee still faces downward pressure this year, but the magnitude of the decline has narrowed, and net interest margin is expected to show a stabilizing trend.

“We expect the loan yield in 2026 to continue the downward trend, but the rate of decline will be significantly smaller,” said Yao Mingde, vice president of Industrial and Commercial Bank of China, at the bank’s 2025 annual results briefing. In May 2025, most of the repricing effects brought about by the adjustment of the LPR (loan prime rate) have already been reflected. However, considering that the LPR may still be reduced this year, loan yields may continue to move downward in the future, but the decline will narrow.

Yao Mingde said that if we do not consider factors such as further significant adjustments to the LPR and deposit quotation rates, it is expected that this year Industrial and Commercial Bank of China’s net interest income will turn positive year over year, reaching a turning point, and the rate of decline in net interest margin will further converge compared with 2025.

“Looking ahead to 2026, we expect China Bank’s net interest margin’s year-over-year decline to narrow significantly, and net interest income to achieve positive growth,” said Liu Chenggang, vice president of Bank of China, at the bank’s 2025 annual results briefing.

At a 2025 results briefing for Bank of Communications, Zhou Wanfù, vice president of Bank of Communications, said that this year the maturing quota of time deposits is expected to increase noticeably compared with 2025, with a relatively large proportion concentrated in the first quarter of this year. Looking across the full year, net interest margin is expected to maintain a stabilizing and improving trend.