Non-interest income becomes the second growth curve in bank transformation

This article was reprinted from: Qilu Evening News

As of March 29, 13 A-share listed banks have disclosed their official annual reports. Against the broader industry backdrop of ongoing declines in financing costs for the real economy and pressure on banks’ net interest margins, the performance of the banking industry that has been disclosed shows a pattern of “overall recovery with differentiation among individual institutions.” Compared with the downward trend in net interest margins among state-owned-share banks, some regional banks’ net interest margins have rebounded against the trend.

Against the backdrop of the industry’s net interest margins continuing to narrow, many listed banks are using non-interest income as their main lever, accelerating their efforts in wealth management, asset management, and investment banking, while continuously optimizing their transformation from a traditional “provider of funds” to a “resource integrator.” In the view of institutional analysts, during the period when net interest margins are moving downward, an increase in the share of non-interest income can not only help stabilize banks’ revenue and profit performance, but also drive a transformation and upgrading of banks’ operating models. Among them, banks with strong customer-base foundations, a well-developed product system, and full-chain service capabilities will gain first-mover advantages in the wealth management transformation, achieving a leap in the business model from “earning interest margin” to “earning service fees.”

In the view of multiple institutional participants, the decline in banks’ interest spreads this year is expected to narrow significantly. As high-interest deposits mature and are re-priced in the first quarter of 2026, the certainty of the recovery in banks’ full-year performance will continue to improve.　　　　　From Blue Whale News