Vice President of China Merchants Bank Peng Jiawen: It is expected that the net interest margin will continue to narrow in 2026, with the narrowing range likely to be better than the previous year.

Ask AI · What are the key factors behind the rebound in China Merchants Bank’s net interest margin in the fourth quarter?

Beijing Business Daily News (Reporter Meng Fanxia, Zhou Yili) On March 30, at China Merchants Bank’s 2025 annual results briefing, the bank’s vice president, chief financial officer, and board secretary, Peng Jiawen, provided interpretations of the bank’s 2025 net interest margin trend and outlook for 2026.

Peng Jiawen said that China Merchants Bank’s 2025 net interest margin was 1.87%, down 11 basis points from the previous year; in terms of quarterly data, it was 1.91% in the first quarter, then fell to 1.86% and 1.83%, before rebounding to 1.86% in the fourth quarter. “In 2025, our net interest margin showed two characteristics: first, the net interest margin was still declining, but the rate of decline narrowed; second, during the year’s run, there was a certain rebound in the fourth quarter.”

Peng Jiawen said that achieving a narrowed decline in the 2025 net interest margin and a rebound in the fourth quarter benefited from the bank’s efforts in asset-liability management. On the pricing side, it strictly implemented the requirements of self-regulatory mechanisms, promoted deposit rate cuts, while strictly controlling loan pricing levels and continuing to improve the pricing structure. On the structural side, it increased the proportion of credit assets with relatively higher returns; under pressure in retail loan demand, it supported asset growth. Meanwhile, in the fourth quarter it repriced low-yield assets such as bills, optimized asset portfolio management, and multiple factors jointly drove a certain rebound in the net interest margin in the fourth quarter.

Regarding the net interest margin trend in 2026, Peng Jiawen believes the overall judgment remains that it will continue to narrow, but the degree of narrowing is expected to be better than in 2025. Looking ahead to 2026, the bank will further take effective asset-liability management measures and work to achieve three major goals: first, further narrow the amount of decline in the net interest margin; second, in the absence of major policy changes in the external environment, strive to stabilize the net interest margin in the second half of the year; and third, continue to keep the net interest margin level among the market leaders.