The report card from China Minsheng Bank still receives poor reviews.

（Source: Gushan Capital）

Minsheng Bank’s 2025 annual report has just been released with great fanfare.

This is the 6th set of annual performance results he has turned in since Gao Yingxin took the helm at Minsheng Bank in June 2020—unfortunately, it’s still a low rating.

In 2025, Minsheng Bank’s total assets exceeded 7.8 trillion, but growth was painfully slow. Revenue was RMB 142.9 billion, up 4.82%, which is RMB 6.6 billion more than the previous year. Net profit was RMB 30.6 billion, which is RMB 1.7 billion less than the previous year, representing a decline of 5.37%.

Over the past year, Minsheng Bank’s revenue increased while profits decreased—this is clearly a scissors gap. The root cause still lies in asset quality.

In 2025, Minsheng Bank’s credit impairment losses reached as much as RMB 53.95 billion, up 18.64% year over year, with an increase of about RMB 10 billion.

Among this, provisions for loans increased significantly—from RMB 39.0 billion in 2024 to RMB 47.9 billion in 2025, adding RMB 8.9 billion in provisions.

So although revenue in 2025 increased by RMB 6.6 billion, in the end it all got used to plug the holes created by bad debts. Net profit, however, decreased by RMB 1.7 billion—that’s the reason.

If we dig a bit deeper, Minsheng Bank’s biggest hemorrhaging point is in retail business, especially its credit card business.

The annual report of Minsheng Bank shows that personal loans and advances are the hardest-hit areas for non-performing loans. In 2025, the scale reached RMB 1,678.9 billion. The non-performing loan ratio had already reached 1.92%, and the corresponding balance of non-performing loans is close to RMB 32.2 billion.

Among this, credit card loans with a scale of RMB 432.5 billion show the most prominent risk, with the non-performing loan ratio rising from 3.28% in 2024 to 3.87% in 2025, and the corresponding balance of non-performing loans exceeding RMB 16.7 billion.

As everyone knows, credit cards are pure unsecured consumer credit—no collateral, no guarantees. Once they become non-performing, the recovery probability is low. They are basically “toxic assets” that are hard to recover.

So when people often see many banks disposing of non-performing assets, they usually package credit card non-performing loans, transferring and selling them at “fire-sale” prices—often around one-tenth of the value. It’s not that banks are dumb; banks understand better than anyone that the recovery of these bad debts is, in all likelihood, hopeless.

So in 2025, Minsheng Bank showed a rather unusual scene: even the loan balance declined by 0.45%. Even loans are being reduced as part of balance-sheet shrinking. Minsheng Bank truly seems to be frightened by bad debts.

From an overall perspective, Minsheng Bank’s non-performing loan ratio in 2025 was 1.49%, still rising compared with 1.47% at the end of 2024. The allowance coverage ratio was only 142%, basically flat with 2024.

As Minsheng Bank—a bank that has been continuously selected as a domestic systemically important bank—its allowance coverage ratio, however, has long been below the regulatory requirement of 150%. It has been treading the bottom line for a long time, with weak risk-loss offset capacity. The “grain warehouse” used to reserve profits has also long been left empty, losing the flexibility to release profits by adjusting the allowance.

The key question is: will Minsheng Bank’s asset quality improve in the coming years? Most likely, it will still be difficult.

In 2025, the outstanding balance of loans under watch status at Minsheng Bank still exceeded RMB 121.9 billion. The scale is huge, and this will be the largest potential exposure for future generation of non-performing loans.

With Minsheng Bank’s current risk provisions, it is difficult to fully cover potential risks. This also means that repairing asset quality in the future will take time, and it will require continued high levels of investment.

But time doesn’t wait. Gao Yingxin, Chairman, born in July 1962, is about to turn 64. At this age, he has already reached beyond the usual retirement age for service. Having served nearly 6 years in the chairman position at Minsheng Bank, how much time does he still have to wait?

Looking back to more than five years ago in 2020, when Gao Yingxin was brought in from China Banking Corporation, he took over as chairman of Minsheng Bank. At that time, there were widespread expectations: After being seasoned through years at China Bank, what kind of Minsheng Bank would this veteran be able to build?

But judging from performance, for Minsheng Bank, those 5 years from 2020 to 2025 were almost like 5 lost years.

During these 5 years, Minsheng Bank’s revenue scale kept declining, and net profit stagnated. In these two years in particular, it has fallen more noticeably. Asset quality has long been stuck in a quagmire. Profitability has continued to deteriorate. ROE fell from 6.48% to 4.43%, placing it at the bottom among joint-stock banks for the long term.

Operating income: In 2020 it was RMB 184.95 billion, and it kept sliding in only one direction down to RMB 136.3 billion in 2024, a decline of 26%. In 2025 it rebounded slightly to RMB 142.9 billion. It must be said that Minsheng Bank’s sharp contraction in revenue scale is quite rare.

Net profit attributable to the parent company: In 2020 it was RMB 34.3 billion, and in the following years it saw slight growth. After 2023, it fell from RMB 35.8 billion to RMB 32.3 billion in 2024, and then further to about RMB 30.6 billion in 2025—accelerating downward over the past two years.

Asset quality: The non-performing loan ratio improved slightly, rising from 1.82% in 2020 to 1.49% in 2025. But the allowance coverage ratio has long been too low, staying on the red line—rising from 139% in 2020 to 142% in 2025, far below the average allowance coverage ratio of joint-stock banks (200% or above).

And over these five years, Minsheng Bank’s credit impairment losses have long stayed at a high level. In 2020 they were as high as RMB 65.0 billion. After rising to RMB 77.0 billion in 2021, they began to decline, but in 2025 they were still as high as RMB 53.95 billion. The lofty credit impairment losses continued to erode Minsheng Bank’s profits.

On one side, profitability has continued to deteriorate during his tenure. Yet as the captain, Gao Yingxin in recent years has repeatedly fallen into controversies and whirlpools over “high pay,” and even being called the “compensation king” among joint-stock companies.

According to relevant statistics, from the end of June 2020 when he took office to 2024, the complete compensation of Minsheng Bank Chairman Gao Yingxin (including the parts disclosed in annual reports + the other parts) were RMB 3.18 million, RMB 6.33 million, RMB 6.15 million, RMB 5.88 million, and RMB 4.97 million. Gao Yingxin’s full compensation for 2025 has yet to be disclosed.

Worth noting is that Gao Yingxin’s compensation level stood at the top among A-share listed bank chairmen in 2021–2023, and ranked second in 2024 among A-share listed bank chairmen—but it was still first among joint-stock banks.

High compensation should match strong performance. Based on Minsheng Bank’s performance, how much compensation should Chairman Gao Yingxin be paid in 2025?

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