Wuxi Bank: Quarterly revenue and profit both decline—how to break through under multiple pressures?

Ask AI · Wuxi Bank’s quarterly performance turns negative, what risks are hidden behind?

Wuxi Bank’s 2025 financial report shows mixed results, with annual revenue and profit maintaining growth, but some key indicators’ trends are not optimistic, and hidden risks deserve attention.

First, it is worth noting that in the fourth quarter, revenue and net profit attributable to the parent both declined: revenue decreased by 4.23% year-on-year, and net profit decreased by 2% year-on-year. Second, as the interest spread continues to narrow, the full-year net interest income growth rate is only 0.21%. In addition, the personal loan balance has decreased for three consecutive years since its peak in 2022; regional competition among peers has intensified, leading to faster capital consumption, and the capital adequacy ratio has declined for three consecutive years.

Performance growth rate gradually declines, turns negative in Q4

Looking at the full-year data, Wuxi Bank’s 2025 performance is not bad, with total operating income of 4.82B yuan, up 1.98%; net profit attributable to the parent of 2.31B yuan, up 2.53%, and basic earnings per share of 1.01 yuan, maintaining an annual growth trend. However, beneath these impressive annual figures lies a key signal that the market may overlook: quarterly performance growth is declining each quarter, with revenue and net profit both contracting in Q4.

In Q4 2025, Wuxi Bank’s revenue decreased by 4.23% year-on-year and fell by 5.93% quarter-on-quarter, while net profit declined by 2%, still within an acceptable range. It is worth noting that the bank’s provisioning coverage ratio has continued to decline.

Provision coverage ratio continues to decrease

As of the end of 2025, Wuxi Bank’s provisioning coverage ratio was 414.91%, down 42.69 percentage points from the end of the previous year. Compared to 427.87% at the end of Q3 2025, it decreased by 12.96 percentage points, continuing its downward trend.

The provisioning coverage ratio, as a “water reservoir” for bank profits, means that lowering it can reduce loan impairment provisions and short-term profit releases. Even if the bank moderately supports profits by lowering the coverage ratio, Wuxi Bank’s net profit in Q4 still declined year-on-year, indicating pressure on core profitability.

It is noteworthy that although the bank’s provisioning coverage ratio has continued to decline, it remains well above regulatory requirements. As of the end of 2025, among listed banks that have disclosed annual reports, it ranks first.

Personal loans and capital adequacy ratio decline for three consecutive years

In addition, from the core data of the financial report, Wuxi Bank also faces issues such as narrowing net interest margin, declining personal loans, and pressure on intermediary business income.

Looking at the revenue structure, in 2025, Wuxi Bank’s net interest income accounted for over 70% of total revenue. Against the backdrop of a narrowing interest spread, the full-year growth rate of net interest income was only 0.21%. Non-interest net income maintained growth, but core fee and commission net income declined by 4.02% year-on-year to 131 million yuan. Non-interest income growth heavily relies on investment income, which reached 1.25B yuan in 2025, up 25.51% year-on-year.

Furthermore, data shows that Wuxi Bank’s personal loan balance has decreased for three consecutive years since its peak in 2022. By the end of 2025, the personal loan balance was 23.69B yuan, a reduction of about 502 million yuan from the end of the previous year, with declines in credit card overdrafts, personal housing loans, and personal consumption loans.

In addition, the Yangtze River Delta region’s financial competition is fierce, with leading institutions like Jiangsu Bank and Ningbo Bank competing with local small and medium-sized banks for market share. To expand market share, Wuxi Bank has increased credit issuance, leading to faster capital consumption. By the end of 2025, its capital adequacy ratio fell to 13.83%, down for three consecutive years.

Overall, Wuxi Bank’s net profit in 2025 maintained positive growth, partly benefiting from the continuous decline in provisioning coverage ratio releasing profits. However, issues such as declining personal loans, narrowing net interest margin, and intensified regional competition remain to be addressed. This also partly explains why some small and medium-sized banks’ annual reports appear stable, yet their stock prices remain weak, as the market may have already anticipated underlying profit growth concerns.

(Article serial number: 2039597266456678400/JW)

Disclaimer: This article does not constitute any investment advice to anyone.
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