Bank Annual Report Season Turmoil: Dividend Announcement "Blunder" and Executive Remarks Spark Heated Debate

Ask AI · What is the deep underlying reason for the controversy sparked by the Chairman of China Merchants Bank’s “moat” statement?

【Global Network Finance Reporter Tan Yawen】During the annual report season of listed banks, hot topics such as net interest margins and asset quality remain the industry’s common focus. This year, however, the bank’s dividend “blunder” and senior executives’ controversial remarks unexpectedly captured public attention, becoming a new hot topic in market discussions.

Dividend announcement error, official correction

On March 27, Bank of Communications disclosed its 2025 annual report and profit distribution plan. The announcement stated that the bank planned to “distribute a cash dividend of 3.247 yuan per share (tax included) for the year 2025.” According to the annual report, Bank of Communications’ net profit for 2025 was 95.62B yuan. Based on this plan, the total dividend payout would far exceed the annual net profit. Subsequently, on March 30, Bank of Communications issued a correction notice stating that due to inadequate proofreading, there were textual errors in the original announcement. Before correction, it read: “cash dividend of 3.247 yuan per share (tax included),” and after correction, it read: “cash dividend of 3.247 yuan for every 10 shares (tax included),” meaning the actual dividend per share was 0.3247 yuan.

Because dividends directly affect investors’ interests, this incident quickly drew attention. Some investors noted that such a blunder was not the first of its kind. On April 19, 2024, Hangzhou Bank also issued a notice stating that due to staff oversight, there was a typo in the “per share distribution ratio” in the 2023 profit distribution plan announcement. At that time, Hangzhou Bank promptly issued a correction, changing “cash dividend of 5.20 yuan per share (tax included)” to “cash dividend of 0.52 yuan per share (tax included).”

In comparison, Bank of Communications took two days to issue a correction. Market performance showed that Bank of Communications’ stock price was unaffected; from March 27 to April 2, the bank’s stock price rose for five consecutive trading days.

Reaffirming stable dividends

On April 2, Bank of Communications responded on an interactive platform to investor questions raised on March 19 about valuation enhancement and increasing dividend payout ratios. The bank stated: “We also note that the attention from institutional investors toward us continues to rise. In the future, we will continue to focus on operational management, strive to maintain steady and progressive development, and strengthen our fundamental operations; at the same time, we will continue to enhance communication with the market to increase value recognition.”

Bank of Communications said that regarding dividend issues, it always adheres to the principle of maximizing investor value, maintaining a payout ratio of over 30% for 14 consecutive years. Going forward, with stable operational performance, the bank will continue to provide attractive and stable dividend returns to reward investors.

According to He Zhaobin, Secretary of the Board of Directors of Bank of Communications, during the earnings release, on March 27, the bank held a board meeting that approved the “2025 Profit Distribution Plan,” which will continue the mid-term dividend policy. In the second half of the year, the bank will distribute a cash dividend of 0.1684 yuan per share (tax included) to all shareholders, totaling 14.88 billion yuan. Based on this, combined with the already paid 2025 semi-annual dividends, the total cash dividend per share for 2025 will be 0.3247 yuan, with a total payout of 28.69B yuan, accounting for 30.0% of net profit attributable to the parent company shareholders and 32.3% of net profit attributable to ordinary shareholders. The dividend payout ratio has maintained over 30% for 14 years.

Chairman’s remarks spark controversy, investors seek explanation

Another well-known joint-stock bank also fell into controversy due to remarks made by its chairman during the earnings presentation.

At the 2025 annual performance briefing of China Merchants Bank, Chairman Miao Jianmin responded to the company’s “moat” concept by stating that the true moat of China Merchants Bank is to internalize the “customer-centric” philosophy into corporate culture and to translate this into employees’ daily behaviors.

He specifically gave an example: “If you go to a China Merchants Bank branch outside working hours, or after 5 p.m. on a weekday, what do you see? Our employees are dedicated to their jobs; our colleagues rarely leave on time, which is very difficult and hard work. After the 2025 annual performance report was announced last Friday, our board office colleagues quickly communicated with domestic and foreign analysts and investors on Friday evening and Saturday, thoroughly discussing market opinions and organizing feedback. This reflects our corporate culture, and I think this is the biggest ‘moat.’”

This statement triggered different interpretations externally. Some investors left messages on the Shanghai Stock Exchange’s interactive platform asking China Merchants Bank to explain the senior executives’ remarks. Despite the controversy, the bank’s official release of the “2025 Annual Performance Conference Q&A Transcript” on its website did not delete or alter this statement, and it remains part of the record.

It is worth noting that when asked how to maintain market-oriented mechanisms and competitive advantages amid bank homogenization, Miao Jianmin further stated that market-oriented and professionalization are the foundation of China Merchants Bank and will not be affected by other factors, such as salary reforms, which will not impact the bank’s market-oriented nature. He reiterated that China Merchants Bank has internalized professionalism, market orientation, and the “customer-centric” philosophy into its corporate culture, which he considers the greatest “moat.”

According to China Merchants Bank’s annual report, as of the end of 2025, the group employed 121,585 staff (including dispatched personnel). Compared to 2024, the number of employees increased by 4,384. Among them, retail banking staff saw the largest growth.