Shanghai Pudong Development Bank Co Ltd

The A+H bank sector strengthened against the market during the broader pullback, with the CSI Bank Index rising 1.43% and the Hong Kong Stock Connect Mainland Financial Index up 0.15%. Ping An Bank, Bank of Nanjing, Bank of Ningbo, and Bank of Jiangsu have already disclosed interim reports, with year-on-year growth in both operating revenue and net profit attributable to the parent turning positive. Among them, Bank of Ningbo's net profit attributable to the parent grew 12.12% year-on-year. Shanghai Pudong Development Bank, Bank of Chongqing, and Chongqing Rural Commercial Bank disclosed preliminary results, with Bank of Chongqing's operating revenue and net profit attributable to the parent both growing more than 10% year-on-year. The industry-wide net interest margin saw its first quarter-on-quarter rebound in nearly four years. Analysts believe the stabilization of net interest margins mainly benefited from improved liability costs brought by the repricing of time deposits, but loan yields still face downward pressure, and margins are expected to remain broadly stable in the second half of the year.

Data from the National Financial Regulatory Administration shows that in the second quarter of 2026, the net interest margin of commercial banks was 1.41 percent, up 0.01 percentage point from 1.40 percent in the first quarter, marking the first quarter-on-quarter increase since 2022. As of August 18, Ping An Bank, Shanghai Pudong Development Bank, Bank of Jiangsu, Bank of Chongqing, and Chongqing Rural Commercial Bank have all released their 2026 interim results or preliminary earnings reports. All five banks achieved positive growth in both revenue and net profit in the first half, and their year-on-year revenue growth rates all improved compared with the same period last year. Bank of Chongqing's revenue rose 10.80 percent year on year to 8.486 billion yuan, Bank of Jiangsu grew 9.11 percent to 48.952 billion yuan, Chongqing Rural Commercial Bank increased 7.81 percent to 15.892 billion yuan, Shanghai Pudong Development Bank rose 3.55 percent to 93.777 billion yuan, and Ping An Bank grew 1.8 percent to 70.617 billion yuan. In terms of net profit, Bank of Chongqing's net profit attributable to shareholders was 3.518 billion yuan, up 10.28 percent year on year; Bank of Jiangsu posted 21.876 billion yuan, up 8.09 percent; Chongqing Rural Commercial Bank reported 8.168 billion yuan, up 6.09 percent; Shanghai Pudong Development Bank recorded 30.951 billion yuan, up 4.08 percent; and Ping An Bank delivered 25.696 billion yuan, up 3.3 percent. A common feature of the five banks is that deposit growth was significantly higher than loan growth, consistent with central bank data: at the end of July 2026, the outstanding balance of renminbi deposits grew 8.1 percent year on year, while the outstanding balance of loans grew 5.1 percent. Bank of Jiangsu had the largest gap between deposit and loan growth, with deposits up 17.39 percent from the end of last year and loans up 12.20 percent. Bank of Chongqing's deposits grew 10.87 percent and loans grew 9.63 percent. Shanghai Pudong Development Bank's deposits rose 5.05 percent and loans rose 2.88 percent. Ping An Bank's deposits increased 2.2 percent and loans increased 1.8 percent. Ping An Bank President Ji Guangheng said effective financing demand remains insufficient, and retail personal loan growth in the first half was only a few billion yuan. On asset quality, Bank of Jiangsu's non-performing loan ratio was 0.81 percent, the best since its listing; Chongqing Rural Commercial Bank's ratio was 1.05 percent, down 0.03 percentage point from the end of last year; Ping An Bank's ratio was 1.05 percent, unchanged; and Shanghai Pudong Development Bank's ratio was 1.25 percent, down 0.01 percentage point.

Youa Shares plans to transfer its 9% stake in Zixing Pudong Development Village Bank to Shanghai Pudong Development Bank for 28.24 million yuan, and will no longer hold any equity in the bank after the transaction. The announcement shows that as of June 30, 2025, Zixing Pudong Development had total assets of 2.976 billion yuan, total liabilities of 2.663 billion yuan, and net assets of 313 million yuan, with a net loss of 46.18 million yuan in the first half of 2025. The transaction is expected to bring Youa Shares a gain of about 14.02 million yuan and have a positive impact on its 2026 financial statements, without involving any change in the scope of consolidated statements. Youa Shares achieved revenue of 208 million yuan in the first quarter of 2026, with net profit attributable to the parent company of 42.39 million yuan.

Several A-share companies have released a batch of announcements covering interim reports, share buybacks, contract wins, and equity changes. Quectel's first-half net profit rose 27.84 percent year on year, and it plans to pay a dividend of 4.7 yuan per 10 shares. Baofeng Energy's net profit increased 70.14 percent year on year, with a planned dividend of 4.2 yuan per 10 shares. Yihai Kerry Arawana posted a net profit of 2.294 billion yuan, up 30.69 percent year on year. Shanghai Pudong Development Bank reported a net profit of 30.951 billion yuan, up 4.08 percent year on year. Weihua New Materials plans to buy back shares worth 80 million to 120 million yuan, while Southeast Electronics plans a buyback of 14 million to 28 million yuan. Hybio Pharmaceutical and Sunshine Mandi signed a cooperation agreement for semaglutide injection, and CATL plans to invest in the Hainan Times Green Industry Investment Fund.

Three major Chinese banks, Industrial and Commercial Bank of China, China Merchants Bank, and Shanghai Pudong Development Bank, have started trialing the interbank repo rate as a benchmark for setting loan interest rates, replacing the sole use of the Loan Prime Rate. This marks a significant step in China's loan rate reform. All three banks have already issued their first loans referencing the repo rate. ICBC extended a one-year loan of 76.7 million yuan to a foreign company, SPDB lent 7 million yuan to a state-owned enterprise, and China Merchants Bank provided approximately 8 million yuan in credit. The shift reflects greater flexibility for Chinese commercial banks in determining borrowing costs amid sluggish credit demand, and helps interest rates better reflect actual funding costs. This comes after money market rates and bond yields fell faster than the LPR in recent years. The People's Bank of China signaled support for this approach in its May monetary policy report, noting that many countries have developed multi-benchmark loan pricing systems to more accurately reflect funding costs and credit risk.

On July 16, the A-share market saw a sizable wave of concentrated dividend distributions. Wuliangye, Bank of Ningbo, Shanghai Pudong Development Bank, and other companies completed cash dividend payouts on the same day, with total distributions exceeding 29 billion yuan. Wuliangye distributed approximately 10.007 billion yuan in cash based on 3.879 billion shares, after deducting shares held in the repurchase account, paying 25.796852 yuan per 10 shares to all shareholders. Bank of Ningbo paid a cash dividend of 9 yuan per 10 shares based on its total share capital of 6.6 billion shares, totaling 5.943 billion yuan. Shanghai Pudong Development Bank distributed a cash dividend of 0.42 yuan per share, totaling 13.988 billion yuan. In 2025, 22 companies have cumulative actual dividends exceeding 10 billion yuan, with Industrial and Commercial Bank of China, China Mobile, and China Construction Bank surpassing 100 billion yuan, and Agricultural Bank of China, PetroChina, Kweichow Moutai, and several others exceeding 50 billion yuan.