Bank of China (601988) Investment Research Analysis (As of Q3 2025)

1. Core Profitability Performance
In the first three quarters of 2025, the group's revenue reached 491.204 billion yuan, a year-on-year increase of 2.69%; net profit attributable to shareholders was 177.660 billion yuan, up 1.08% year-on-year. The net profit for Q3 alone increased by 5.09% year-on-year, with profitability turning positive from negative. ROA is 0.70%, ROE is 8.98%, cost-to-income ratio is 26.90%, maintaining a reasonable efficiency range for a major bank.
2. Revenue Structure and Growth Drivers
Net interest income was 325.792 billion yuan, down 3.04% year-on-year, accounting for 66.3%, affected by a low net interest margin of 1.26%.
Non-interest income was 165.412 billion yuan, up 16.20% year-on-year, accounting for 33.7%, becoming the main growth engine, primarily from foreign exchange, precious metals, and investment income.
The business mainly focuses on corporate banking, personal banking, and financial markets, with personal banking revenue accounting for approximately 39.5%, and corporate banking about 36.3%. The bank features significant globalization and integrated operations.
3. Asset Scale and Quality
Total assets are 37.55 trillion yuan, an increase of 7.1% from the beginning of the year; total loans are 23.35 trillion yuan, up 8.15%; deposits are 25.68 trillion yuan, up 6.1%, with steady expansion.
Non-performing loan ratio is 1.24%, slightly down 0.01 percentage points from the beginning of the year; loan loss coverage ratio is 196.60%, indicating sufficient risk buffers; capital adequacy ratio is 18.66%, reflecting a high safety margin.
4. Core Advantages and Operating Characteristics
Backed by the creditworthiness of a state-owned major bank, with concentrated equity and ample liquidity, demonstrating strong cyclical resilience.
Leading in globalization, with stable contributions from overseas operations, serving as a core platform for cross-border finance and foreign exchange businesses.
Non-interest income is accelerating, effectively hedging against margin pressure, enhancing revenue resilience.
5. Key Pressures and Focus Areas
Net interest margin remains at a historic low, with a declining interest rate cycle continuously suppressing interest income.
Risks in areas such as real estate remain significant, with marginal improvements in asset quality but ongoing monitoring required.
Overseas operations are affected by exchange rate fluctuations and overseas policy changes.
6. Summary
Bank of China’s profitability is steadily recovering, with positive growth returning; non-interest income has become a core growth driver. Asset quality remains stable, with strong risk resistance, exhibiting typical low volatility characteristics of a major bank. The main operating focus is on maintaining interest margins, increasing non-interest income, controlling risks, and expanding cross-border business, overall presenting a profile of high safety, low growth, and strong defensiveness.