Net profit from mother in the first half of the year was 6.862 billion yuan, up 11.3% year on year: CITIC Financial Assets (02799) consolidated the foundation of growth, driven by improvements in the quality and efficiency of the main business

The Zhitong Finance App learned that on August 31, China CITIC Financial Asset Management Co., Ltd. (hereinafter referred to as “CITIC Financial Assets” or the “Company”, 02799) released a performance report for the first half of 2026 on the Hong Kong Stock Exchange. By the end of June 2026, the company achieved total revenue of 25.951 billion yuan, an increase of 36.6% year on year after excluding one-time influencing factors; realized net profit of 6.528 billion yuan, an increase of 18.6% year on year; and realized net profit of 6.862 billion yuan, an increase of 11.3% year on year. The average annualized return on equity (ROE) was 21.4%, up 0.3 percentage points year on year; the average annualized return on assets (ROA) was 1.2%, up 0.1 percentage points year over year.

Since joining the CITIC Group in March 2022, CITIC Financial's assets have maintained steady growth for 4 consecutive years, and the quality and efficiency of development has continued to improve. In the first half of 2026, the company recorded the best mid-term operating results since joining the CITIC Group. Net profit, net profit to mother, and core indicators such as ROE and ROA increased simultaneously, and the profit level continued to be at the forefront of the industry. This not only reflects the continuous optimization of the company's asset structure and the continuous enhancement of endogenous management capabilities, but also confirms that the transformation and development of the main non-performing asset business supports performance growth.

With comprehensive management quality improvement and reform results, the company has been highly recognized by the international capital market. On July 21, Fitch upgraded the company's long-term issuer entity rating from “BBB” to “BBB+”. The outlook is “stable,” and the overseas bond rating was simultaneously raised to “BBB+.” Fitch pointed out in the rating report that as CITIC Group's synergy continues to deepen, the company's position in the industry has been further consolidated, profit stability has been enhanced, and asset quality has improved markedly; diversified financing channels are stable and the financing structure continues to be optimized, playing an increasingly important role in implementing the country's key economic tasks and undertaking CITIC Group's policy functions.

Deeply cultivate bad core businesses and become a driving force for performance growth

In the first half of 2026, the core profit indicators of CITIC Financial's assets continued to improve, and the quality and efficiency of the use of capital were further improved. Thanks to the continuous improvement in the quality and efficiency of the company's main non-performing asset business, it became the strongest driving force for revenue and profit growth.

According to financial data, in the first half of the year, the company's main non-performing asset business achieved total revenue of 26.738 billion yuan, a year-on-year increase of 46.4% after excluding one-time influencing factors. The three core businesses of acquisition and disposal, bailout and equity are working together, and value creation capacity continues to increase: consolidated interest income of 5.771 billion yuan, up 29.8% year on year, of which interest income from bailout and revitalization business was 3.856 billion yuan, up 26.9% year on year; fair value of non-performing debt assets changed by 3,229 billion yuan, up 2,920 billion yuan year on year, mainly due to significant improvements in the quality of disposal business assets and a marked increase of disposal efficiency; dividend income of 1,576 billion yuan, an increase of 1,030 billion yuan over the previous year. The results of the transformation of the main business are being rapidly transformed into more stable and resilient operating returns.

Balance and liability are being optimized in both directions, and the positive development trend is increasingly consolidated

During the reporting period, the company achieved multi-dimensional management quality improvements in assets, financing and capital. Investment in the main business has been steadily increasing, inventory risk clearance has been accelerated, and asset structure and asset quality have been optimized in both directions; the financing side has achieved all-round breakthroughs in credit expansion, product innovation, long-term extension, and cost decline, and comprehensive financing capabilities have reached a new level. Fitch's increase in the main rating is the market's authoritative recognition of the company's operating strength, governance ability and long-term development prospects. Various business indicators continue to improve, build a strong medium- to long-term development chassis, and guarantee strong sustainability in terms of profit.

Financing capacity has been upgraded by leaps and bounds, and the diversified financing system is becoming more and more perfect. At the credit level, the corporate financial institution cooperation base continues to be consolidated, and cooperation channels continue to be broadened. At the same time, financing innovation has blossomed a lot, and brand financing tools have performed brilliantly. The Yunfan series of bonds achieved four issuances. The issuance scale in the first half of the year was 25 billion yuan, and the issuance interest rate hit new lows in the industry several times. The company successfully launched an open market green financing product, won the industry's first 3-year ABS order in the past five years, and continues to enrich diversified and low-cost financing channels. By expanding financing sources and promoting debt replacement, the average interest rate on stock financing fell further by 16 bps from the beginning of the year. While the scale of financing increased, interest expenses fell by 1,378 billion yuan year on year, a decrease of 9.6%.

The quality of capital management and internal control is being improved simultaneously. The company continues to optimize capital allocation. At the end of June 2026, the company's capital adequacy ratio was 15.71%, and the core level 1, level 1 and capital adequacy ratios were fully met. The results of reducing costs and increasing efficiency are obvious. In the first half of 2026, the company's total consolidated expenditure was 20.657 billion yuan, a year-on-year decrease of 41.2%, and its refined operation capacity continued to increase.

The industry circuit is rich in dividends, and differentiated advantages enable long-term growth

Currently, there is abundant supply in the domestic non-performing asset industry, and the market space continues to expand. The scale of non-performing loans of commercial banks has been operating at a high level for a long time. From 2023 to 2025, the scale of non-performing asset disposal in the industry exceeded 3 trillion yuan for three consecutive years. By the end of the second quarter of 2026, commercial banks' non-performing loan balances reached 3.73 trillion yuan, an increase of 52.3 billion yuan over the previous month. Combined with factors such as structural adjustments in traditional industries and overcapacity, the real economy continues to release the supply of non-performing assets. By the end of 2025, the balance of accounts receivable from industrial enterprises nationwide reached 26.77 trillion yuan, an increase of 7.26% over the previous year. The cash flow and operating pressure of physical enterprises still existed, and demand for disposal of non-performing assets continued to rise. Furthermore, there is an urgent need in the three core areas of real estate risk mitigation, local debt management, and risk of small and medium-sized financial institutions. Combined with the implementation of the “three centralization” requirements in the new round of central enterprise reform, the need to revitalize the stock deposit assets has been further highlighted, opening up broad incremental space for the non-performing asset industry.

Against the backdrop of a boom in the industry, market competition continues to intensify. The industry has officially bid farewell to extensive expansion and entered a new stage of specialized, refined and differentiated competition. Under this pattern, the core competitive advantage of CITIC Financial Assets has been fully highlighted. The ability to manage non-performing assets has stabilized its position in the first tier of the industry. It has formed a standardized, systematized, and replicable business style, and built a solid competitive barrier to differentiated competition. Innovate to create a collaborative insurance model for industry and finance, implement a number of benchmark and exemplary risk mitigation projects, fully unleash the collaborative potential of CITIC Group, and form a unique “CITIC Plan” for risk mitigation and asset value reshaping.

Based on the above analysis, relying on broad industry growth space, mature main business management systems, and scarce industrial and financial collaboration advantages, CITIC Financial Assets is expected to continue to seize core opportunities such as risk mitigation, stock revitalization, and physical relief, continue to consolidate operating fundamentals, steadily release performance momentum, have outstanding medium- to long-term growth, and have high long-term investment value.