Postal Savings Bank NPL Ratio Hits 1.00% at Mid-2026

On August 28, Postal Savings Bank of China (PSBC) released its 2026 interim results. As of end-June 2026, the bank's non-performing loan (NPL) ratio stood at 1.00%, up 0.05 percentage points from end-2025. The ratio of special-mention loans was 1.73%, up 0.16 percentage points from end-2025, though the pace of increase narrowed. At the interim results conference that day, Vice President and Chief Risk Officer Yao Hong noted that the banking industry's retail credit asset quality has faced overall pressure in recent years, and PSBC, with a relatively high share of retail business, has experienced significant structural downward migration pressure on asset quality.

Yao said that as of end-June, PSBC's corporate loan NPL ratio was 0.52%, down 0.02 percentage points from end-2025, while the personal loan NPL ratio was 1.58%, with an annualized new NPL generation rate of 1.67%. Although new NPL generation remained at a high level, the pace of increase had narrowed. In the first half, the year-on-year increase in the annualized new NPL generation rate for personal loans narrowed by 0.17 percentage points compared with 2025, and narrowed by 0.05 percentage points quarter-on-quarter in the second quarter.

Regarding the changes in asset quality, Yao attributed them mainly to continued strengthening of retail asset quality controls. Specific measures include: reshaping processes to enhance due diligence and centralized review, implementing checks and balances at key stages, and strictly regulating operational conduct; dynamically optimizing risk control strategies by managing business admission and lending priorities based on risk-adjusted returns; and enhancing intelligent risk control applications, using internal and external data more broadly to improve monitoring and prevention of credit and fraud risks.

Discussing the full-year outlook, Yao said that for corporate loans, the bank will continue to strengthen industry research, expand the list of qualified credit customers, deepen the integration of credit policies, marketing strategies, and credit approval admission, fully apply the "look to the future" credit assessment technology, improve the conversion rate of the qualified customer list, and continuously optimize the credit structure. For personal loans, the bank will tighten admission standards, increase the share of high-quality customers, and ensure the quality of new loans; implement regulatory relief policies to provide standardized assistance to customers with temporary operational difficulties but sound fundamentals and strong repayment willingness; fully utilize disposal resources to intensify NPL collection and disposal; and implement regulatory deployments to crack down on illegal and irregular activities in the financial sector, launching the "Consolidation Action" special campaign to build a culture of transparent credit.