Net profit continues to grow, and risk control is solid. Is Ruifeng Bank worth long-term optimism?

Produced by | China Visit Network

Reviewed by | Li Xiaoyan

On March 26, Zhejiang’s first listed rural commercial bank, RuiFeng Bank (601528), released its 2025 annual report. For the full year, it achieved operating revenue of RMB 4.408 billion and attributable net profit to shareholders of RMB 1.966 billion, up 0.53% and 2.30% year over year, respectively. Despite the broader environment of tightening bank industry net interest margins and growing headwinds for growth, it still delivered a steady set of results showing “both revenue and profit increases.” Although the share price saw a short-term pullback on March 27, based on core dimensions such as operating fundamentals, strategic layout, and risk-absorbing capacity, RuiFeng Bank is building a foundation for high-quality development in regional deepening and breakthrough transformation with a posture of “stability first, and progress while staying stable.” The short-term volatility looks more like the market’s short-term release of sentiment rather than a true reflection of long-term value.

In 2025, facing industry-wide challenges such as uneven macroeconomic recovery and sustained pressure on banks’ net interest margins, RuiFeng Bank stayed committed to its “support agriculture and serve small businesses” positioning. Its operating performance achieved steady growth against the trend, and its key indicators continued to improve.

In terms of scale, the bank’s asset size expanded steadily. Total assets at year-end reached RMB 241.495 billion, up 9.52% from the beginning of the year. Total deposits stood at RMB 178.099 billion, up 9.47%; total loans were RMB 141.206 billion, up 7.82%. Loan and deposit growth both maintained double-digit rates, providing a solid base for earnings growth. More worth noting is that net cash flow from operating activities swung sharply from RMB -0.610 billion in 2024 to RMB 4.546 billion, significantly improving cash-flow conditions and continuously strengthening its ability to “generate cash” from operations.

In terms of profitability, although operating revenue growth slowed somewhat compared with 2024, attributable net profit to shareholders has maintained positive growth for multiple consecutive years, highlighting earnings stability. After excluding non-recurring gains and losses, attributable net profit to shareholders was RMB 1.877 billion, up 10.18% year over year, further improving the quality of earnings. Basic earnings per share were RMB 1.00, up 2.04%. At the same time, the board of directors proposed a cash dividend of RMB 2.10 per 10 shares, continuing to reward shareholders through cash dividends, demonstrating confidence in its own development and responsibility to investors.

Against the backdrop of industry-wide downward pressure on net interest margins, RuiFeng Bank, through refined asset-liability management, successfully stopped the decline and stabilized its net interest margin, with core businesses showing strong resilience.

Net interest income, as the “anchoring ballast” for earnings, reached RMB 3.254 billion for the year, up 8.33%, becoming the core driver supporting revenue growth. This increase did not rely on “trading price for volume.” Instead, it resulted from the coordinated push of scale expansion and net interest margin management: on the one hand, steady growth in loan size provided a base for interest income; on the other hand, by optimizing the deposit funding structure, the deposit interest expense rate fell to 1.83%, down 37 basis points from the prior year. This effectively offset the pressure from declining asset-side yields, ultimately stabilizing the net interest margin at 1.50%, outperforming the broader trend of the industry’s net interest margins continuing to narrow.

Non-interest income, though subject to short-term pressure due to volatility in the bond market, continued to optimize structurally, with “the second growth curve” such as wealth management and international business accelerating its formation. In wealth management, non-interest income on a year-over-year basis grew 18.13%; in international business, settlement volume grew 49.41% year over year. The international settlement volume of the Yiwu segment reached USD 6.088 billion, accounting for more than 60% of the bank’s total. The bank’s cross-border financial特色 advantages continued to expand. Short-term fluctuations in non-interest income are more of a phased performance influenced by market conditions. As wealth management and inclusive finance continue to advance in depth, the growth potential of non-interest income will be gradually released.

As a local bank rooted in Shaoxing, RuiFeng Bank implemented the regional development strategy of “One Base and Four Arrows.” Using Keqiao as the primary stronghold, and Yiwu, Yuecheng, Binhai, and Shengzhou as growth engines, it has formed a development pattern of “stable core and breakthroughs in multiple points,” with continuously improving regional competitiveness.

“One Base”: Keqiao’s main base continues to be deeply cultivated. Its existing customer base is solid, and the deposit interest expense rate is effectively managed, providing stable cash flow and profit support for the bank’s overall development. “Four Arrows”: the four regional areas have become core engines for incremental growth. New loans in the four regions totaled RMB 3.9959 billion, accounting for 38.99% of the bank’s total incremental loans; new deposits were RMB 5.812 billion, accounting for 37.73%. Operating revenue reached RMB 1.220 billion, up 8.56%, and the proportion of total operating revenue increased by 2.05 percentage points. Among them, Yiwu focuses on cross-border finance; Yuecheng builds a “government-industry-university-research-commerce” coordinated ecosystem; Binhai strengthens linkages across the industrial chain; and Shengzhou deepens county-level scenario cultivation. Each region’s differentiated positioning is clear, and the synergy effect is prominent, opening up broad space for future growth.

At the same time, the bank focuses on the “five major articles” of finance. Technology, green finance, inclusive finance, retirement finance, and digital finance are advanced in an all-round way. Loans to technology-based enterprises, green loans, inclusive loans to small and micro businesses, and loans to core industries of the digital economy all achieved growth of more than double digits. It precisely addresses the real-economy needs, and achieves high-quality growth of its own business while serving regional development.

Asset quality is the lifeline for a bank’s sound operations. Although in 2025 RuiFeng Bank’s non-performing loan ratio, the ratio of loans under watch, and the overdue loan ratio showed a slight upward trend, overall they remain at relatively low levels within the industry. Moreover, its risk coverage capacity continued to strengthen, and asset quality as a whole remains controllable.

At year-end, the non-performing loan ratio was 0.99%, up only 0.02 percentage points from the beginning of the year. It has remained at excellent levels below 1% for multiple consecutive years. More importantly, the allowance coverage ratio reached 326.51%, up 5.64 percentage points year over year; the loan loss provision ratio (provision-to-loan) was 3.23%, up 0.13 percentage points, far exceeding regulatory requirements. The bank’s “safety cushion” for risk continued to be thickened, and it has strong capabilities to absorb and manage risks. Meanwhile, it wrote off non-performing loans of RMB 0.615 billion throughout the year, stepping up efforts to dispose of non-performing assets. By proactively releasing potential risks, it cleared obstacles for subsequent sound operations.

From the perspective of risk causes, the upward trend in the ratio of loans under watch and overdue rates is mainly affected by operating pressure on small and micro enterprises and individual industrial and commercial households. This is an industry-wide common issue, not a failure of RuiFeng Bank’s individual risk controls. For the bank’s core regions in Shaoxing, the non-performing loan ratio is only 0.95%. Although some individual regions within the “Four Arrows” areas saw a slight increase in non-performing loan ratios, overall risk remains controllable. Through optimizing the credit structure and strengthening post-loan management, the bank’s risk management capabilities continued to improve.

At the beginning of 2026, RuiFeng Bank received a large administrative penalty, which drew market attention to its internal control and compliance. However, objectively speaking, this penalty both provides an opportunity to rectify past issues and highlights the bank’s determination to face problems directly and strengthen compliance.

The multiple violations involved in the penalty are common compliance weaknesses for small and medium-sized banks during rapid development, rather than signs of systemic risk hazards. In response to the issues, the bank quickly launched rectification, improved systems and processes, and strengthened compliance training for employees. Its internal control management system continued to be optimized. Meanwhile, at the end of 2025, the adjustment in the appointment of the president concurrently serving as the chief compliance officer, although it triggered discussions about compliance independence, is fundamentally an important measure for the bank to strengthen compliance management and solidify compliance responsibilities. Led by “the person in charge,” it promotes deep integration of compliance and business, preventing compliance risks from the source.

In addition, the bank’s executive compensation is linked to performance. In 2025, the compensation of the chairman and the president increased slightly, reflecting the match between performance and compensation. The incentive mechanism is reasonable and effective, providing solid governance assurance for operational development.

RuiFeng Bank’s “double increase” in performance in 2025 is the result of sound operations under industry pressure. The short-term share price pullback is mostly the market’s sentiment response to slower growth and slight fluctuations in indicators, rather than a rational judgment of its long-term value.

From fundamentals, the bank has steady growth in scale, highlighted resilience in core businesses, significant effectiveness of its regional strategy, and solid risk-resisting capacity. It has the core competitive strength for continuous and sound development. The short-term slowdown in performance growth and slight fluctuations in asset quality are normal phenomena within a bank’s operating cycle, and also a necessary stage during transformation. As the “One Base and Four Arrows” strategy is advanced more deeply, net interest margin control continues to improve, the structure of non-interest income gets better, and compliance management keeps strengthening, RuiFeng Bank is expected to gradually move out of the short-term adjustment period and return to a trajectory of high-quality growth.

As a benchmark rural commercial bank based in Zhejiang, RuiFeng Bank has always stayed true to its original mission of “serving agriculture, serving small businesses, and serving the real economy.” By deepening its presence in the region, it builds differentiated advantages. By pursuing breakthroughs in transformation, it releases growth potential. Short-term volatility does not change the long-term positive trend. RuiFeng Bank is writing a new chapter in high-quality development for small and medium-sized banks with a steady operational base and strong development resilience.