Jiangxi Bank Co., Ltd. (JIANGXI BANK, 1916.HK) has recently received multiple regulatory penalties for loan violations. Despite the bank's intensified efforts in recent years to dispose of non-performing loans, its loan business management still requires strengthening.

According to regulatory information released on May 15 by the National Financial Regulatory Administration, financial regulators decided to impose a total fine of 1.15 million yuan on Jiangxi Bank and two of its branches. The primary reasons were inadequate loan management and using new loans to repay old ones, thereby concealing non-performing assets.

Since the beginning of this year, the bank has accumulated fines of no less than 2.15 million yuan specifically for loan business violations, with total penalties reaching no less than 2.56 million yuan.

The non-performing loan ratio at Jiangxi Bank saw a notable increase in 2022. In response, the bank implemented a three-year action plan to tackle asset quality. In recent years, its non-performing loan ratio has shown a gradual, slow decline. The bank has also significantly increased its loan write-offs over the past three years. From 2023 to 2025, the total write-off amount reached 18.658 billion yuan.

By the end of 2025, the bank's non-performing loan ratio stood at 2%, representing a year-on-year decrease. However, this figure remains higher than the industry average. Concurrently, the non-performing loan ratio for the manufacturing sector increased year-on-year.

While addressing non-performing assets, the bank's performance growth has experienced considerable volatility in recent years. In 2025, the bank's operating income decreased by 21.89% year-on-year, and its net profit attributable to the parent company declined by 8.74%. This trend is contrary to the positive year-on-year growth in net profit observed across the commercial banking sector during the same period.

Furthermore, the bank's capital adequacy ratio has been on a continuous downward trend in recent years.

Recent Penalties for Loan Violations Jiangxi Bank and two of its branches were recently penalized for loan business violations. Since the start of the year, the bank has accumulated fines totaling no less than 2.56 million yuan.

Information published on the National Financial Regulatory Administration website on May 15 shows that the Jiangxi Bureau decided to fine Jiangxi Bank 400,000 yuan and its Nanchang Jinxian Sub-branch 500,000 yuan. The main reasons included inadequate loan management and using loans to repay loans to conceal non-performing assets. The Jiujiang Bureau also decided to fine Jiangxi Bank's Jiujiang Branch 250,000 yuan, primarily for inadequate loan management.

All the aforementioned violations relate to loan business operations.

Since the beginning of this year, Jiangxi Bank has been penalized multiple times for loan business violations. Information released on the regulator's website on February 25 and March 13 shows that regulators decided to fine Jiangxi Bank 300,000 yuan and its Pingxiang Branch 700,000 yuan. The main reasons included inadequate loan management and improper issuance of personal loans.

According to Jiangxi Bank's 2025 annual report, its non-performing loan ratio at the end of the year was 2%, down 0.15 percentage points year-on-year but still higher than the 1.5% average for commercial banks during the same period. Meanwhile, the non-performing loan ratio for the manufacturing sector was 3.22%, an increase of 0.56 percentage points year-on-year.

Jiangxi Bank's non-performing loan ratio has been slowly declining in recent years, standing at 1.47%, 2.18%, 2.17%, and 2.15% at the end of 2021, 2022, 2023, and 2024, respectively.

It is noteworthy that Jiangxi Bank has significantly increased its loan write-offs in recent years.

From 2021 to 2025, the write-off amounts on the bank's loan impairment provision change table were 1.57 billion yuan, 1.085 billion yuan, 6.059 billion yuan, 7.211 billion yuan, and 5.388 billion yuan, respectively. The annual write-off amounts from 2023 to 2025 were substantially higher than those in 2021 and 2022, with the total for the latter three years reaching 18.658 billion yuan.

Jiangxi Bank stated that it is deeply implementing a three-year action plan for asset quality improvement, increasing efforts to dispose of non-performing loans, strengthening risk prevention and control in key areas, and strictly guarding against unexpected deterioration of large assets. The bank also adheres to a dual-track approach for recovering non-performing loans from both major clients and retail banking, strengthens classified disposal management, and carries out special collection actions.

Information released on the National Financial Regulatory Administration website on February 25 and April 24 also shows that regulators decided to fine Jiangxi Bank's Nanchang Yingbin Avenue Sub-branch 400,000 yuan, mainly for failing to strictly review the authenticity of trade backgrounds in bank acceptance bill business. The bank's Nanchang Jingdong Avenue Sub-branch was given a warning and fined 10,000 yuan, primarily for losing its financial license due to poor management.

Decline in Both Revenue and Net Profit Last Year Jiangxi Bank's performance declined rapidly in 2025, with income from all major revenue items falling across the board.

Jiangxi Bank's 2025 annual report shows that the bank's operating income for the year was 9.028 billion yuan, a year-on-year decrease of 21.89%. Net profit attributable to the parent company was 965 million yuan, a year-on-year decrease of 8.74%. In contrast, the net profit of commercial banks grew by 2.33% year-on-year during the same period.

The bank's net profit growth rate has fluctuated significantly in recent years. From 2022 to 2024, the year-on-year growth rates of net profit attributable to the parent company were -25.15%, -33.13%, and 2%, respectively. During the same periods, the year-on-year growth rates of net profit for commercial banks were 5.44%, 3.23%, and -2.27%, respectively.

In 2025, the item that most significantly impacted Jiangxi Bank's performance growth was the net gain from financial investments, which amounted to 671 million yuan, a year-on-year decrease of 69.76%. This decline was primarily due to the combined effects of market interest rate fluctuations and changes in asset values.

In 2025, the bank adjusted its allocation of financial investments, mainly increasing holdings of policy bank bonds and reducing fund investments. At the end of the year, policy bank bonds accounted for 35.01% of its financial investments, an increase of 7.29 percentage points year-on-year. Fund investments accounted for 9.70%, a decrease of 10.92 percentage points year-on-year. The fund investments primarily include money market funds and bond funds.

Jiangxi Bank's net interest income also decreased by 9.95% year-on-year in 2025. Within this, scale factors contributed an increase of 634 million yuan, while interest rate factors led to a decrease of 1.49 billion yuan. The bank's net interest margin for the year was 1.41%, a decrease of 0.23 percentage points year-on-year.

The bank's net fee and commission income also decreased by 18.09% year-on-year in 2025, mainly due to a 31.61% year-on-year decline in agency and custody business fees.

Regarding capital adequacy, the bank's capital adequacy ratio has shown an overall downward trend in recent years. The capital adequacy ratios at the end of 2022, 2023, 2024, and 2025 were 14.00%, 13.55%, 13.47%, and 12.41%, respectively. The core tier 1 capital adequacy ratios for the same periods were 9.65%, 9.37%, 9.30%, and 8.60%, respectively.