In November, the financial landscape of the three provinces in Northeastern China took on a distinctly chilly tone.
On the 24, JiuTai Rural Commercial Bank, the very first rural commercial bank in Northeast China, was officially delisted from the Hong Kong Stock Exchange as an H-share. According to its 2024 half-year financial report, the bank recorded an operating income of 2.045 billion yuan, down 18.78% year-on-year, with net profit at 130 million yuan, up 1.64% year-on-year—this also marked the last time it would update its performance report.
On the 21, Shengjing Bank—once in the spotlight—also delisted from the Hong Kong stock market.
On the 14, Jinzhou Bank’s app officially ceased operations, and its offline branches began to remove their original signage, gradually replacing it with that of the Industrial and Commercial Bank of China (ICBC). Just a year prior, in April 2024, Jinzhou Bank had delisted from the Hong Kong Stock Exchange.
With these developments, Harbin Bank is now the only listed bank remaining in the three northeastern provinces. However, since its stock price fell below 1 Hong Kong dollar in September 2020, Harbin Bank has struggled to shake off the “penny stock” label. As of the close on November 2nd, its share price stood at just 0.375 HKD.
The Same Script of Dramatic Highs and Lows
Prior to 2019, Jinzhou Bank had always been considered a leading city commercial bank.
In 2010, it received approval to establish a Beijing branch, becoming the first prefecture-level city commercial bank to set up a branch in the capital. In December 2015, Jinzhou Bank went public on the Hong Kong Stock Exchange, deliberately choosing the stock code “00416”—the telephone area code for Jinzhou city. From 2013 to 2017, the bank’s net profit skyrocketed from 1.36 billion yuan to 9.09 billion yuan, a cumulative increase of 5.7 times, with a compound annual growth rate of more than 46%, far surpassing the average level of the banking industry during the same period.
The turning point came in 2019. In May of that year, auditors from Ernst & Young suddenly resigned. The subsequent financial reports confirmed market fears: in 2018, the bank reported impairment losses on assets as high as 23.68 billion yuan, resulting in a huge annual loss of 4.54 billion yuan.
By the end of June 2019, Jinzhou Bank’s non-performing loan balance had approached 30 billion yuan, an increase of 11 billion yuan from the end of 2018; its non-performing loan ratio rose from 4.99% at the end of the previous year to 6.88%. The balance of special-mention loans reached a staggering 92 billion yuan, accounting for almost 21.6% of the bank’s total loan portfolio. After this, the bank’s share price began a prolonged collapse. By the time trading was suspended in January 2023, the share price had dropped to 1.38 HKD, representing a 70% fall from its IPO price. For 15 months prior to the suspension, the bank’s average daily trading volume was less than one ten-thousandth of its total shares. In the capital markets, it had, for all intents and purposes, lost its capacity to raise funds.
Once known as the Number One Northeast City Commercial Bank”, Shengjing Bank went public in 2014 and reached its peak in 2019, with its asset size surpassing one trillion yuan and net profit soaring to an impressive 5.44 billion yuan. But the turning point came in 2020: due to deep entanglement with the real estate sector, Shengjing Bank began to face risks from loans granted to Evergrande Group, causing its non-performing loan ratio to skyrocket from 1.71% in 2018 to 3.28% in 2021.
By the end of 2024, although Shengjing Bank’s assets barely held at 1.1 trillion yuan, its profitability had plunged to rock bottom: annual revenue dropped to 8.58 billion yuan, falling below the 10-billion threshold for the first time—a nearly 60% decrease from its peak. Net profit attributable to shareholders shrank to only 620 million yuan, about one-tenth of its prime.
The latest case is Jiutai Rural Commercial Bank, which experienced a similarly dramatic boom and bust. Until 2022, Jiutai Rural Commercial Bank had rapidly growing results. In 2023, its revenue was 5.514 billion yuan, down 16.4% year-on-year, while net profit plummeted by 89.35%. Losses persisted into the third quarter of 2024.
According to two profit warnings posted on Jiutai Rural Commercial Bank’s official website, the bank is expected to lose 1.7–1.9 billion yuan in 2024 alone. Losses are expected to reach 898 million yuan in the first half of 2025. Jiutai Rural Commercial Bank attributes these losses mainly to changes in the external market environment, noting that asset impairment losses in the first half of 2025 are projected to increase by 312.42% compared to the same period in 2024.
Liquidity Dilemma
In July, Jiutai Rural Commercial Bank issued a statement saying that its “ability to raise capital effectively from the equity market is extremely limited, and the current listed status no longer provides a viable financing channel for our operations.”
This kind of liquidity problem also plagues Harbin Bank, which still maintains its listed status.
Recent trading data shows that Harbin Bank’s single-day turnover frequently hovers at just several hundred thousand Hong Kong dollars, with only one trading day in all of November where turnover barely exceeded one million. For a bank with assets of several hundred billion yuan and a market capitalization of over four billion yuan, daily turnover of a few hundred thousand can be almost disregarded.
Even so, Harbin Bank is already considered a “top performer” in terms of liquidity among mainland city and rural commercial banks listed in Hong Kong. For example, on November 2nd, banks such as Yibin Bank, Weihai Bank, Quanzhou Bank, Jinshang Bank, Luzhou Bank, and Guangzhou Rural Commercial Bank all recorded zero trading volume, while several other city and rural commercial banks also saw extremely low activity.
There are three so-called “penny stocks” trading below 1 HKD per share: aside from Harbin Bank (0.375), they are Zhongyuan Bank (0.315) and Gansu Bank (0.249).
According to annual report data, Harbin Bank’s non-performing loan (NPL) balance reached a staggering 10.757 billion yuan in 2024. Over the past five years, from 2020 to 2024, the bank’s NPL ratios have consistently remained high at 2.84%, 2.87%, 2.89%, 2.88%, and 2.97%, respectively. In the “Top 100 Banks in China” list published by the China Banking Association in 2024, Harbin Bank’s NPL ratio (2.84%, as reported in its annual report) ranked third lowest from the bottom. The only banks below it were Wuhan Rural Commercial Bank at 2.91% and Inner Mongolia Bank at 3.21%.
Data from Enterprise Early Warning Express shows that by the end of 2024, several of the bank’s credit risk indicators were among the worst in the sector: NPL ratio at 2.84% (92nd out of 96), NPL balance of 10.757 billion yuan (80th out of 87), and an overdue loan ratio of 13.61% (85th out of 85).
In the first half of this year, Harbin Bank’s total assets stood at 927.528 billion yuan, a 1.23% increase from the end of last year. Its operating income reached 7.386 billion yuan, up 2.59% year-on-year, and net profit climbed to 992 million yuan, an increase of 17.28%. The bank’s NPL ratio dipped slightly by 0.01 percentage points to 2.83% compared to the end of last year.
State-Owned Big Banks in Northeast China
The footprint of state-owned big banks in Northeast China is also gradually shrinking.
Among them, ICBC (Industrial and Commercial Bank of China) has pulled back the most, as seen by comparing its 2014 and 2024 annual reports. Ten years ago, ICBC operated nearly 4,000 branches in Northeast China, accounting for one-fifth (22.5%) of its nationwide outlets, with staff numbers approaching 100,000 (20.8% of its total workforce).
A decade later, ICBC had only 1,586 branches left in the Northeast, with the share dropping to single digits (9.7%). Its headcount was slashed to 36,000 people, making up less than 10% (8.9%) of its total employees.
This means that in the past decade, on average, two ICBC branches in Northeast China closed every three days, and 16 staff members left the counters each day.
The contraction of services in Northeast China by other major state-owned banks has been relatively moderate.
For China Construction Bank, its revenue share from Northeast China decreased from 5.8% to 4%. The total number of its employees in the region dropped from over 37,000 to 33,000, a reduction of more than 4,000 positions.
Agricultural Bank of China’s revenue share in Northeast China saw a slight uptick, but its headcount reduction was even larger. In 2014, the bank had 54,000 employees in the region; ten years later, the number had fallen to just over 40,000.
As the state-owned bank with the fewest branches in Northeast China, Bank of China has also seen its local presence shrink. Over the past decade, the number of its branches dropped below 900, decreasing from 955 to 892. Its workforce shrank in tandem from 26,000 to 22,000, with its proportion sliding to 7.3%.
It is clear that, both in terms of revenue and resource allocation, Northeast China’s contribution to the Big Four banks has steadily declined. While the number of bank branches has slightly decreased, staff numbers have contracted considerably. Even so, the current data still reveals a structural mismatch: though revenue contributions from Northeast China have dropped to 3-4%, the proportion of employees in the region remains at 7-9%. This indicates that per capita productivity in Northeast China remains below the national average for these banks.
