Changshu Bank Welcomes Its Youngest President: Can the Internal Training Model Solve the Efficiency Dilemma?

The bank with the highest net interest margin among A-shares is about to welcome its youngest-ever president.

Recently, Changshu Bank announced that President Bao Jian and Vice President Li Yongjun have resigned due to job changes;

On the same day, the candidate for the new president emerged, with Vice President Lu Dingchang set to serve as both President and Chief Compliance Officer.

Lu Dingchang, 39 years old, has grown up within the Changshu Bank system, having started as a grassroots loan officer and served as head of departments such as Inclusive Finance and Small and Micro Finance, with experience in branch management roles.

Once regulatory approval is obtained, he will set a new record as the youngest president among A-share listed banks.

His predecessor, Bao Jian, was also the youngest president among listed banks and also started from the grassroots, working his way up from a teller to the presidency. He led the creation of the small and micro finance business, developing the "Changyin Weijin" model focused on county market specialization.

Benefiting from the "Changyin Weijin" model, the bank has seen many performance highlights in recent years:

First, its net interest margin at the end of Q3 continues to be the highest among A-share banks, remaining at a high level of 2.57%;

Second, its growth momentum is strong, with three-year compound annual growth rates in revenue, net profit, and return on net assets ranking among the top in the industry.

While demonstrating strong counter-cyclical capabilities, the bank seems unable to shed its reliance on the "manpower-intensive strategy" of loan officers:

Xinfeng noted that at the end of 2024, not only was the bank's headcount far higher than peers of similar size, but its cost-income ratio, revenue per capita, and profit per capita were all at the lower end of the industry.

The surging performance and mismatched efficiency together constitute the "A and B sides" of Changshu Bank's county business.

Now, the bank is welcoming another president who began as a loan officer;

This new "helmsman," deeply familiar with the Changshu model and rich in frontline experience, will lead Changshu Bank in its future expansion, but only time will tell in what way.

Interest Margin Stabilizes

In the first three quarters of this year, Changshu Bank's revenue and net profit attributable to shareholders were 9.052 billion yuan and 3.357 billion yuan, respectively, up 8.15% and 12.82% year-on-year.

Although the growth rate of both indicators continues to contract compared to the full-year growth rates of 16.2% and 10.53% in 2024, they remain in the top tier among the 42 A-share listed banks, both ranking 5th overall, and second only to Jiangyin Bank among rural commercial banks.

The leading growth compared to peers comes from synchronized increases in interest, fee income, and investment returns:

On one hand, interest income—making up nearly 80% of revenue—increased by 2.39%, stabilizing the performance base.

At the end of Q3, Changshu Bank’s net interest margin fell by 14 basis points from the start of the year;

But loan volume maintained fast expansion, up by 7.03% to 248.823 billion yuan since the start of the year, successfully using scale to offset pressure on pricing.

Despite the downward trend, Changshu Bank’s net interest margin remains its greatest competitive advantage:

At the end of Q3, the bank still maintained a net interest margin of 2.57%, the highest among A-share listed banks, 20 basis points more than second-place Zhengzhou Bank, and 99 basis points higher than the overall rural commercial bank average;

In terms of trend, the decline in net interest margin is narrowing, with only a minimal quarter-on-quarter drop of 0.01% at the end of Q3, indicating basic stabilization.

Xinfeng noted that among Changshu Bank’s interest-earning assets, retail lending is particularly prominent:

In the first half of the year, retail and corporate loans contributed 54.73% and 24.69% of interest income, respectively;

Retail loans make up more than half of total lending, with asset yield as high as 6.59%, leaving peers far behind.

Compared to peers, Changshu Bank’s loan yield of 5.33% and deposit cost of 1.96% in H1 are similar to Ping An Bank—which excelled in net interest margin among joint-stock banks in 2023, specializing in a “high-risk, high-return” strategy;

The difference is that Ping An later suffered from the risks inherent in chasing yields, having to make painful adjustments in its credit business to protect asset safety, still undergoing a “bone scraping” transformation;

Whereas Changshu Bank’s bad loan ratio remains controlled at 0.76%, with provision coverage at 462.95%, both ranking 2nd among 42 A-share banks, which is excellent by industry standards.

On the other hand, Changshu Bank’s investment and fee income, though limited in scale, are developing unique characteristics.

In the first three quarters, investment operations contributed 18.44% of the bank’s revenue.

This may stem from timing bond market transactions—Changshu Bank disclosed that it realized 1.201 billion yuan investment income from trading bonds and similar assets in H1, up 30% YoY;

In Q3 financials, this income rose further to 1.669 billion yuan, though the YoY increase slowed to less than 20%, while holdings in bond investments dropped sharply, likely reflecting Q3 profit-taking on timely trades.

In recent years of bond market volatility, Changshu Bank has been active, once called one of the “Four Little Dragons of Rural Commercial Debt”; it was even disciplined by the dealer association for alleged irregular trading in the secondary government bond market amid the 2024 bond bull run.

However, the bank’s bond trading abilities do appear notable:

In the first three quarters, investment and fair value gains totaled 491 million yuan, doubling YoY and outperforming peers.

Beyond investment, Changshu Bank’s “light asset businesses” are growing.

In the first three quarters, fee income contributed only 3.34% of revenue, but grew 364.75% YoY, mainly due to higher commission incomes from agency wealth management services;

In H1, the bank sold 7.277 billion yuan of managed wealth products and 260 million yuan of insurance, while private banking clients grew by 10.8% from the start of the year to 4,214, with total client assets at 28.677 billion yuan at Q2 end.

The “Weijin” Approach

Changshu Bank’s development path in recent years is quite representative among commercial banks.

Xinfeng’s data shows that in the past three years (2022–the first three quarters of 2025), the bank’s annual compound growth rates for revenue, net profit, and return on net assets were 35.48%, 60.3%, and 14.66%, respectively;

All three rank 2nd among 42 A-share banks, making Changshu one of the most outstanding growth stories in the sector.

These robust results stem from the “moat” Changshu has built in county markets.

Since its conversion from a rural credit cooperative to a rural commercial bank in 2001, serving “agriculture, rural areas, and small clients” has always been its core positioning;

To tackle risk control, in 2009 it introduced Germany’s IPC microloan technology, which the management team localized, forming the “IPC tech + loan factory + mobile platform” Changyin Weijin model.

It’s clear this model is the key differentiator setting Changshu apart from other small- and mid-sized banks:

On one hand, the “Changyin Weijin” mode emphasizes light collateral and strong cash flow in small business lending, with standardized procedures balancing risk and scale, and great replicability;

Combined with Changshu’s rare investment management village bank (hereafter “investment management bank”) license, its effect is further amplified.

In early 2019, the former CBIRC issued “Opinions on Promoting Rural Commercial Banks to Stick to Their Positioning, Strengthen Governance and Improve Financial Services”, requiring rural commercial banks in principle to “not operate outside their county, and not offer cross-county services.”

Soon after, Changshu Bank obtained the only investment management bank license among rural commercial banks and set up Xingfu Village Bank in Hainan.

This means the bank could not only break the restriction on cross-region operations and set up village banks outside its home county, but also use the investment management platform to centrally manage its village banks, shortening the management chain and boosting efficiency.

On this basis, Changshu Bank began to use its model to expand nationwide via the investment management license.

In 2024, business outside Changshu contributed 73.52% of revenue and 80.48% of pre-provision profit;

Among these, province-wide and out-of-province village banks contributed 7.56% and 16.96% of revenue respectively.

On the other hand, “Changyin Weijin” risk controls have enabled the bank to avoid major credit mishaps;

Its county-market focus has made it more resilient during periods of falling property prices, shrinking resident assets, and weakening consumer sentiment.

In 2024, the bank served over 1.5 million small business loan clients, with bad loans long below 1%;

The “Changyin Weijin” model has not only been successfully ported to Xingfu Village Bank, but even packaged as a systematic template for the industry.

The net interest margin under this model is also the bank’s “moat”.

This might explain why Changshu’s management selection criteria and path differ from other listed banks.

The core way IPC tech controls risk is through people—loan officers must make on-site visits, observe and estimate clients’ monthly cash flow, and even interview neighbors and suppliers to assess repayment willingness;

This “all-in-one” approach requires loan officers to handle the entire lending process — marketing, investigation, disbursement, and collection.

Xinfeng’s summary found two key features in the bank's management: youthfulness and grassroots experience.

By 2024, Changshu Bank’s management averaged 47 years old, significantly younger than peers. The previous president Bao Jian and vice president Zhou Bin were both from the post-80s generation, and new president Lu Dingchang is from the post-85 generation.

Moreover, Bao Jian, Zhou Bin, and Lu Dingchang all started from teller or loan officer roles at Changshu Bank;

The first two drove the “Changyin Weijin” model from creation to maturity, while Lu Dingchang’s trajectory from loan officer to head of small- and micro-finance mirrors the bank’s small business system.

The “B Side” of Growth

But growth under the “Changyin Weijin” model has its costs.

Changshu Bank’s operating efficiency during expansion has not been impressive. In the first three quarters, its cost-income ratio reached 34.44%, among the worst in the sector (4/42).

Though the bank has increased tech investment, forming integrated microloan, risk control, accounting, channel, and data analysis systems, and reaching industry-leading standards in software testing, quality management, and data management;

In actual business, however, manpower is still the bank’s core resource.

For instance, in deposit gathering, the bank is deeply rooted in the township, administrative village, and natural village grid, using the "Iron Footboard + Big Data + Grid Marketing" approach for targeted marketing and a community manager service model for close client contact;

The “Iron Footboard” refers to loan officers proactively working at the grassroots, and the manager model also requires staff to actively serve clients.

For loans, Changshu worked with the Changshu municipal party’s organization department on specialized campaigns, building up rural “fine-grid microzones” and urban community managers, actively expanding grids beyond its territory with pilot programs in Suzhou and Wuxi;

The bank also focuses on existing clients, conducting comprehensive visits every quarter and using centralized marketing systems to manage opportunities through stratified, targeted contacts;

All of this still relies heavily on both the number and quality of loan officers.

At the end of 2024, the bank had 7,437 employees—similar to Chengdu Bank whose total assets are 3.41 times larger;

That year, per capita revenue and profit were 1.4669 million yuan and 512,700 yuan respectively, ranking 42nd (last) and 37th among A-share banks.

Poor per capita productivity brings challenges for further expansion:

If the “manpower-intensive model” is replicated in more regions, management costs will keep rising;

Meanwhile, its per capita salary of 345,000 yuan in 2024 is low by industry standards (40/42), offering little competitiveness in the senior talent market.

If Changshu Bank wants to make further breakthroughs in its lending business, the key may be using technology to transform its “manpower strategy” into more refined and intelligent operations, boosting individual staff productivity.

With the recent management shakeup, two other headlines accompany Lu Dingchang’s appointment: the hiring of two new vice presidents (Zhang Kangde and Ni Jianfeng), and a 0.17% share increase by major shareholder Changshu Investment Holdings.

With new management in place and shareholder support, whether Changshu Bank can achieve greater expansion remains to be seen.

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