Qilu Bank Chairman Sees Deposit Costs Falling but NIM Pressure Persisting; H1 Net Profit Up 16.57%
Qilu Bank Chairman Zheng Zugang said deposit costs will decline in the second half but net interest margin will remain under pressure. The bank reported H1 2026 net profit of RMB 3.174 billion, up 16.57% year on year, with revenue rising 10.55% to RMB 7.497 billion. Individual loan NPL ratio rose to 2.69%.
On September 1, Zheng Zugang, Party Secretary and Chairman of Qilu Bank, said at the bank's 2026 interim results briefing that due to adjustments in the real estate sector, risk exposure in personal business loans and residential mortgage loans had increased, pushing up the non-performing loan (NPL) ratio for individual loans in the first half. As of end-June, the bank's individual loan NPL ratio stood at 2.69%, up 41 basis points from the beginning of the year, while the corporate loan NPL ratio was 0.63%. Zheng said the bank would improve asset quality in individual loans through measures including refining credit review standards, building a standardized retail credit operation system, optimizing the retail risk management framework, and expanding collection and disposal channels.
As of end-June 2026, Qilu Bank's capital adequacy ratio was 14.84%. Zheng said the bank currently has no refinancing plans and will carry out capital planning and refined management in line with regulatory requirements and business development needs.
In the first half of 2026, Qilu Bank's net interest margin was 1.48%, down 5 basis points from 2025. The bank's cost-to-income ratio on interest-bearing liabilities was 1.47%, down 22 basis points from 2025. Zheng said the decline in liability costs had a positive impact on stabilizing the net interest margin, but asset-side yields still faced pressure. The bank would stabilize its net interest margin through refined pricing management and structural adjustments on both the asset and liability sides.
In the first half, Qilu Bank achieved operating revenue of RMB 7.497 billion, up 10.55% year on year, and net profit of RMB 3.174 billion, up 16.57% year on year. Net interest income grew 14.96% year on year.