Dear investors, analysts, friends from the media, good morning. CMB 2023 annual result announcement will now begin. I am CMB Securities Affairs Representative, Head of the Office of the Board of Directors, Xia Yangfang. Today, our result announcement will be presented both on-site and online live streaming. On behalf of China Merchants Bank, I'd like to extend a warm welcome to your participation, and thank you for your long support and investment in CMB. Now, I would like to introduce our attendees. They are: Chairman Mr. Miao Jianmin, President and CEO Mr. Wang Liang, Executive Vice President and Chief Risk Officer Mr. Zhou Jiangtao, Executive Vice President, CFO, Secretary of the Board of Directors Mr. Peng Jiawen. We also have online and offline participants: Mr. Li Menggang and Mr. Tian Hongqi, Independent Directors, and also relevant department heads from CMB. There are two sessions of today's meeting.
The first session will be given by Chairman Miao and President Wang on the 2023 performance overview, taking around 30 minutes. The second session is a Q&A session, takes around 1 hour and 30 minutes. The meeting will be concluded at 11:30 A.M. The meeting will be provided with simultaneous interpretation from Chinese to English. Now, I will give the floor to Chairman Miao and President Wang on CMB 2023 performance.
Dear investors, analysts, friends from the media, good morning. Welcome to China Merchants Bank 2023 annual result announcement. Today's performance presentation will be including three parts. First, I will introduce the company's 2023 performance overview, and then President Wang will introduce the detailed operational information, and then I will briefly introduce our outlook and strategies to 2024.
In 2023, the group has taken to build a value creation bank as our strategic goal, make steady development with progress, strengthen and optimize capital-heavy business, optimize and enlarge capital-light business, enhance wealth management, fintech, and risk management three capabilities, and achieve the quality, profitability, and scale-dynamically balanced development reflected in the following six aspects. Firstly, we actively and effectively respond to challenges in line with our operational performance. Faced with low interest rate cuts, narrowing fee income, sluggish capital markets and insufficient credit demand, and complicated risk conditions and other unfavorable factors, we take active measures to maintain a stable operational performance. Net operating income: CNY 339 billion, down by 1.64% year-on-year. Net profit attributable to the Bank's shareholders, CNY 146.6 billion, year-on-year increase of 6.22%. ROAA was 1.39%, ROAE was 16.22%, representing year-on-year decrease of 0.03 percentage points, 0.84 percentage points, respectively. We make strict control on cost.
Influenced by the decreasing revenue, our cost-to-income ratio was 32.97%, a slight increase of 0.08 percentage points. Our net interest income was CNY 214.6 billion, year-on-year decrease of 1.63%. Although we're influenced by the continuous narrowing interest rate spread and also the structural change of our loan and deposit structure, our NIM was 2.15%, year-on-year decrease of 25 basis points, but still maintained a good level. Influenced by the fluctuating capital market and the enhanced fee rate cut, our non-interest income decreased slightly. Our non-interest net income was CNY 124.4 billion, down by 1.66% year-on-year. Secondly, our asset scale grows steadily and maintains our liability advantages. Our balance sheet maintains stable growth, and at the same time, we continue to optimize our liability structure to maintain our advantages of low funding cost. Our total asset scale was CNY 11.03 trillion, up by 8.77%.
Our total loans and advances to customers was CNY 6.51 trillion, up by 7.56% compared with the end of last year. Total liabilities was CNY 9.94 trillion, up by 8.25% compared with the end of last year. Interest-bearing liabilities average cost ratio was 1.73%, up by 0.12 percentage points year-on-year, maintaining at a good level. Total customer deposits was CNY 8.16 trillion, up by 8.22% compared with the end of last year. Demand deposits' daily average balance proportion to total deposits was 57.08%, maintaining at a high level. Thirdly, we maintain good asset quality, stable asset quality with strong risk compensation capability. We continue to enhance credit risk management, enhance asset quality management. Our NPL balance was CNY 61.5 billion, up by CNY 3.57 billion compared with the end of last year. NPL ratio was 0.95%, down by 0.01 percentage point compared with the end of last year.
Credit cost was 0.74%, down by 0.04 percentage point year-on-year. Allowance coverage ratio was 437.7%, down by 13.09 percentage point compared with the end of last year. Loans provision ratio: 4.14%, down by 0.18 percentage point compared with the end of last year. Fourthly, we continue to optimize our business structure, and our capital maintains adequate growth. We continue to solidify our structural advantages. Retail revenue and profit contribution account for over half of the total volume. Retail finance net operating income and pre-tax profit account for 57.31% and 56.57%, respectively, and giving full play of its balanced role. Non-interest net income account for 36.69% of the total net operating income, maintaining at a good level. We continue to maintain capital adequate growth.
Under the advanced measurement approach, our quarter one CAR, tier one CAR and CAR were 13.73%, 16.01%, and 17.88%, respectively, up by 0.05%, 0.26%, and 0.11 percentage points compared with the end of last year, respectively. Under the risk-weighted approach, our quarter one CAR, tier one CAR and CAR were 11.86%, 13.82%, and 14.96%, respectively, up by 0.34%, 0.57%, and 0.28 percentage points compared with the end of last year. Fifthly, we continue to increase IT input and speed up to construct the AI+ finance model. We increase our input to increase our fintech capability and empower digital operation and management, explore the scenario-based application of AI, and speed up our transformation to smart CMB. IT input amounted to CNY 14.1 billion, accounting for 4.6% of the bank's net operating income.
We continue to optimize talent team with R&D personnel reaching 10,700 people, accounting for 9.14% of the group's total employees. Our Fintech Innovation Fund established 3,700 projects and in total launched over 3,000 projects. We continue to promote new capability construction and exploration of new models, and strive to build 5 smart engines. Our intelligent application has released our full-time personnel of over 17,000 people. We launched LLM ecology construction and established the LLM experience platform to enhance our tech capability. We also actively implement ESG to provide support to the real economy. We further improve our ESG work efficiency and won the A-level rating in 3 consecutive years of the MSCI ESG. We continue to improve the corporate governance system and rename our strategic committee of the board into the Strategic and Sustainable Development Committee of the board.
We fully promote green finance and green operation with green loan balance increased by 26%, and innovatively launched the Green Deposit product and issued the global's first blue floating rate bond. We provide convenient digital financial service to hundreds of millions of customers and lower the carbon emission result from the customer's transportation, and promote our own green transformation of operation. We actively fulfill social responsibility, provide support to the real economy. Our manufacturing loan, inclusive SME loan, and CyTech loan increased by 25%, 18%, and 44.95%, respectively. We continue to promote the improvement of people's livelihood and further allocate resources to key regions in people's livelihood, such as education, pension, etc., and upgrade pension finance into a strategic business. We increase financial accessibility and provide the elderly, the disabled, the foreign traveling to China to provide convenient services.
We strengthen consumer rights protection, enhance our mechanism construction, improve our complaint handling mechanism, attach great importance to privacy protection, and enhance internet safety management. This is briefly my overview to the 2023 performance. Now, I'll give the floor to President Wang on the company's operational detail.
Thank you, Chairman Miao. Now, I will give you a brief introduction over the company's 2023 performance. In 2023, the senior management has acted according to the board's strategic deployment, we adherence to stable development, and maintain good asset quality, strong risk compensation capability, and good profitability among complicated environments. Consolidate our strengths in fortress-style balance sheet and make solid progress in high-quality development, which is mainly reflected in the following six aspects. First, we strengthen quality asset origination and continue to optimize asset allocation with rather loose liquidity and insufficient credit demand.
Under such market environment, we further enhance asset liability management, optimize asset structure, and increase the return of asset allocation. Make multiple measures to strengthen quality asset origination and maintain stable growth in our loan scale. Total loans and advances to customers amount to increase by 7.56%, accounting for 59% of total assets. Regrasp market opportunities to increase the allocation of investment-type assets and make flexible adjustments of interbank assets and increase our capital utilization efficiency. In investment in securities and other financial assets, proportion of the total assets was 29%, increased by 1.61 percentage point. We seize the opportunities arising from the recovery macroeconomy and the credit demand from retail customers, continue to enhance retail loan extension, and retail loans' proportion increase to 54.71% of the total, representing an increase of 0.39 percentage point.
With rather weak growth of the residential mortgage loan, we make active adjustments to promote the steady growth of credit card loan. With the premise of controllable risk, we enhance the loan extension in terms of microfinance and consumer finance, and their proportion in retail loan increase by 1.97% and 2.44 percentage points, respectively. Secondly, we enhance liability quality management and maintain balance in quality and pricing of the loan growth. As we are faced with the challenges brought by more deposit trending towards term deposit, we stick to our liability structure, a strategy to take core deposit as the core to enhance refined management and maintain balance in cost control and customer demand. Core deposit's daily average balance was CNY 6.62 trillion, an increase of 12%, and taking 86% of the total customer deposit's daily average balance. Customer deposit's cost ratio: 1.62%, a year-on-year increase of 10 basis points.
But the growth rate narrowed quarter-on-quarter. The company's RMB-denominated customer deposit's cost ratio was 1.56%, year-on-year decrease of 4 basis points. Thirdly, we continue to enlarge our capital light business and remain resilient in our non-interest income. We deepened business model transformation and strive to build up our wealth management capability and promote the extensive wealth management business development. Retail AUM surpassed CNY 13 trillion, an increase of 9.88%. Golden Sunflower and above customers' AUM achieved CNY 10.82 trillion, up by 9.66%. Asset management business totaled CNY 4.48 trillion, against market downturn achieved an increase of 1.59%. Asset custody business totaled CNY 21.12 trillion, increased by 5.28%. Our non-interest income remained resilient, manifesting our capability to sell through the cycle. Non-interest income account for 36.69% of the total, remaining high. Net fee and commission income: CNY 84.1 billion, accounting for 67.61% of the total non-interest net income.
Under the sluggish capital market, we increase the supply of stable and conservative products and enlarge the scale of asset management and custody business, and mitigate to some extent the pressure brought by lower net fee income. Our extensive wealth management business income was CNY 45 billion, accounting for 53% of the total net fee and commission income. Our payment and settlement business contribution increase, and its proportion of the total net fee and commission income was 41%, 2.97 percentage points higher year-on-year. Fourthly, we continue to enlarge customer base and enhance our comprehensive service capability. Firstly, we always take customer as our center and enhance our customer service capability building with good growth on our customer base. Retail customer group: 197 million, up by 7.07%, among which Golden Sunflower and above customer: 4.64 million, up by 12%.
Credit card active users: 69.74 million, with credit card transaction value achieving CNY 4.81 trillion, maintaining top in the market. We promote to expand corporate customer base with 2.82 million corporate customers, up by 11.66%, among which newly acquired corporate customer was 481,900 customers, with withholding customers amounting to 1.19 million. We increase product innovation, increase product competency to better serve our clients. Corporate customers' FPA was surpassing CNY 5.5 trillion, up by 8.44%. CyTech Green Inclusive Manufacturing loan and loans in other key areas' growth rate were both higher than the average level of the company's loan. We forged featured of our pension finance with pension custody scale surpassing trillion level, achieving both increase in the market share and scale. Investment banking debt financing lead underwriting business totaled CNY 591 billion. Bill discounting business balance increased by 24%.
Transaction banking wealth management cloud service customer increased by 62%, and in cross-border finance, our corporate clients' international BOP under trading goods
volume increased by 9.92%, and in financial market, the derivative transaction volume totaled CNY 64 billion. We speed up to construct our advantages in key regions to promote Yangtze River Delta, Pearl River Delta, Chengdu, Chongqing, and West Taiwan Strait region's key branches to tap into the market potential, to adapt to the regional development pace, to forge new growth points. Branch in key regions' core deposit AUM and corporate loan growth all were recorded higher level than the average of the bank. The key regions' corporate loan balance increased by 16%, whose proportion was increased by 1.95 percentage points of the total of the corporate loan balance.
Our subsidiaries' competencies continue to increase, and their contribution to the bank's profit also increased, with further manifesting of the synergy effect of the group. CMB Wealth Management's product scale was CNY 2.55 trillion, remaining the top in the industry. CMB Leasing enhances asset allocation with a total asset of CNY 290 billion. China Merchants Fund's AUM: CNY 1.55 trillion, up by 4.73%, among which non-money market fund scale was CNY 575.5 billion, ranking top in the industry. CMB International actively worked together with the bank to forge the coordination of investment banking and commercial banking business and finish 30 Hong Kong IPO projects, ranking top among the market. And fourthly, we continue to deepen risk management to prevent risks in key regions. We conduct strict asset classification and fully expose risks, and remain stable asset quality. Retail NPL ratio: 0.89%, remained flat with year-end.
Corporate loan NPL ratio: 1.19%, down by 0.07 percentage point compared with the end of last year. Special mention loan ratio/overdue loan ratio both record decrease compared with the same period of last year, among which special mention loan ratio: 1.1%, down by 0.11 percentage point. Overdue loan ratio: 1.26%, down by 0.03 percentage point. NPL to loan overdue for 60 days ratio was 1.19. New formation of NPL was CNY 60.9 billion, down by CNY 1.9 billion year-on-year. NPL formation ratio: 1.03%, and year-on-year decrease of 0.12 percentage point. NPL disposal scale: CNY 58.1 billion, among which standard written off: CNY 22.6 billion. Securitization: CNY 22.5 billion. Cash collection: CNY 11.2 billion. We effectively manage risk in key regions and maintain controllable asset quality. In real estate business, corporate real estate business balance: CNY 290.7 billion, accounting for 4.71% of the bank's total loan.
Real estate NPL ratio: 5.01%, representing an increase of 1.02 percentage point compared with the end of last year, mainly influenced by individual high-debt customers' further release of risk and slower progress of risk disposal. Those that real estate business that we do not assume credit risk was CNY 249.4 billion, down by 16.95%. Consumer finance and microfinance loan, we continue to improve risk management, select quality clients, and strengthen our quantitative risk control capability, and closely follow the external risks to conduct active classification of risks and maintain good asset quality. Retail microfinance, credit card finance, and consumer finance NPL ratio were 0.61%, 1.75%, and 1.09%, down by 0.05% and increased 0.01 percentage point, respectively. Special mention loan ratio and overdue loan ratio maintain stable. Sixth, we leverage AI Plus to drive model innovation and strive to build a smart CMB.
We embrace the cutting-edge technology revolution surrounding online digital intelligence platform-based and ecological development to speed up the construction of digital finance to transform from online CNB to smart CNB. In terms of AI, we enhance core technology research and speed up the capacity building of natural language processing, cognitive computing, and etc. Explore the application of LLM. CNB application fully use the AI technology to further integrate our smart customer service remote advisory capability and promote the wealth smart assistant Xiao Zhao to provide one-stop wealth management service and customize advisory service to our clients. The number of customers we serve increased drastically. Customer service digitalization in terms of retail finance, we speed up to transform to smart and intelligent retail finance. CNB app and CNB live app has MAU achieving 117 million. Microfinance online approval has account for 66% of the total approval.
In terms of wholesale, we use digital tool to increase relationship managers' service efficiency, with 92% of financing business doing online and 75% of FX business doing online. In terms of risk management, we construct the smart risk control engine and use internal and external data to increase our capability and efficiency of digital risk control. Our Libra system has reduced the percentage of fraud and account takeover by non-cardholders to 0.1 incidents per million. In terms of internal operation, we build the smart operational engine to realize the balance among experience, efficiency, risk, and cost. Over 400 operational processes have finished smart reshaping and be put in application, with a 27% efficiency increase. In terms of digital infrastructure, we build an industry-leading financial cloud infrastructure, continue to deepen the construction of tech middle office and data middle office, enhance R&D efficiency, and lower data using threshold.
Our big data service has already covered 60% of our employees. This is basically our operational information in 2023. Now, I'll give the floor to Chairman Miao on our outlook and strategy in 2024. Now, I will briefly introduce our outlook and strategies in 2024. Looking into the year 2024, the banking industries are faced with both challenges and opportunities. In terms of opportunities, the national economy remains stable while seeking progress. We transform ourselves, adjust structure, and speed up to construct the financial powerhouse to build financial high-quality development, which were mainly reflected in coordinated development of the macro policy, which strengthened the countercyclical and cross-cyclical adjustment. Many policies, including fiscal, monetary, and etc., coordinate with each other. Along with the further release of the policy effect, the national economy's rebound will gain momentum. And secondly, new quality productivity speeds up development. New industry model momentum is enlarging.
Fintech, green, inclusive pension, and digital finance are having great market space. Third, technological advancement represented by AI will bring new opportunities to the banks. Tech innovation further deepens generative AI technology, further iterates, promotes the banking industry into the smart era, bringing new momentum to the bank by using AI+ finance. To see from the challenging side, there are frequent geopolitical tensions and more complicated international environment and more uncertainties. Secondly, the domestic economies are quite weak in terms of its foundation of recovery, insufficient credit demand over capacity, and bottleneck in the domestic circulation. These are all challenges. Thirdly, banks are having more difficulties to remain profit growth, narrower NIM, lower fee rates, and lower risk appetites of our customers, insufficient credit demand. These are all challenges. Tightened regulatory management, complicated risk environment, these are all new normal, posing higher requirements to the bank's operation.
The bank in 2024 will stick to our strategic goal of value creation bank and build our three capabilities of wealth management, fintech, risk management, build our MALI curve to create more value to our customers, employees, shareholders, partners, and societies. Our strategies are as follows. We will firstly maintain our characteristics and competence to build a new moat. We will stick to our professional and market-oriented mechanism and remain retail finance as the strategic mainstay and construct our core competency featured by low liability cost and construct a new moat that takes smart bank as the core. We will be driven by both management and innovation, secondly, to achieve new quality, high-quality development. We will adhere to refine management, solidify foundation, prevent risk, enhance operational efficiency to enhance our quality and competency of service.
We will uphold fundamental principles and break new ground, explore new models such as AI+ finance, human plus digitalization to make synergetic efforts to promote high-quality development. And thirdly, we will further explore new growth points in segmented areas. We will stand on the regional characteristic industry strength where our branches were located and make corresponding policies to speed up the development of branches in key regions and to increase their contribution to the bank and also their market share in the corresponding market. At the same time, focus on customer demand, focusing on our endowment to give full play to our differentiated advantages to develop FinTech, Green, Inclusive, Pension and Digital Finance to build up CMB characteristics and explore new growth points.
And fourthly, we will strengthen Fortress-style risk and compliance management system, adhere to prudent and stable risk culture, enhance our forward-looking assessment to potential risks, and manage all types of risks to effectively prevent real estate local debt, FI in small and medium-sized risks in key regions and in weak links, deepen technological security management, and strengthen compliance risk management and firmly guard our bottom line of asset quality. Thank you.
Thank you, Chairman and President Wang. Now, we will enter into the Q&A session. We will now take the questions from investors and analysts and then take the questions from the friends of the media. As we have numerous participants from today's meeting, please raise your hands to raise questions. Please limit your question to one only, and please state your name and the agency you represent before you raise the question.
We will rotate the questions from first on-site and then online. We will now have the first question from on-site.
Thank you for giving me this opportunity. And good morning, management. I'm May from UBS. I'm very glad to be seeing that CMB achieved such great results and very solid results in such a complex environment. We are very pleased to see that you have raised your dividend payout ratio, and now it's the highest one among Chinese banks. And also, we see that there's a high rise of your share price yesterday for each share, around 5%. So my question is really for the dividend payout ratio. What is your consideration for increasing the dividend payout ratio at this time? And is there any further room for you to further raise the dividend payout ratio, such as for a 2 percentage point every year?
But I know that it relates to your consideration for short-term and long-term growth. You are very strong in terms of profitability, but definitely, you are facing pressure in terms of NIM. You also need to take into consideration the capital for your long-term growth. You also need to take into consideration about the dividend payout to shareholders. So May, I know, do you have any expectations or growth expectations for your RWA growth, or will you slow down your RWA growth in the future?
Thank you very much. I will take the question. For China Merchants Bank, we want to build a value bank for our shareholders, which means that that will be a higher dividend payout ratio and is an important part of the value creation, the meaning of value creation.
Last year, I know that many of you have lost money or break even in this capital market. Paying more in cash as a dividend payout will help to increase your return. Now, 35%, I think, for each share. Our dividend yield is around 6% and each share around 7%. I think that CMB is kind of a share which has a higher dividend payout ratio but with a lower PB ratio. Increasing this dividend payout ratio, once increased, we never thought it would come down again. Whether we will continue to increase that 1-2 percentage point, as you said, that we need to balance among different factors such as cash payout, dividend payout ratio, and also the capital for long-term growth.
We hope that we don't want to do refinancing in the share market, but also, we want to maintain adequate capital growth capability and at the same time with a higher dividend payout ratio. So we need to balance these three factors in the future.
Thank you.
Next question, please. Thank you for giving me this opportunity. I'm from CICC, Zhang Shuaishuai. My question is for Mr. Wang Liang. Last year, you have said that CMB want to strike a balance among different business sectors. To be very frank, last year, we don't understand that. But this year, we would like you to elaborate the logic behind the thinking of this business model.
Thank you very much. Before answering your question, I would like to say a few words. On Monday, we published our annual report.
Yesterday, our A-share and H-share, our share price has risen quite a lot in both A-share and H-share markets. Thank you very much for the recognition from you, from investors and analysts. For these past two days, I have read a lot of articles from investors and analysts. I know there are some suggestions, and there are some criticism. We lay high value on that. Thank you very much for your suggestion and also the criticism for us. We will all take into consideration your suggestions and try to make better work. Last year, actually, we were facing a lot of challenges, both industrial challenges and cyclical challenges and also policy challenges. That is why last year, pressure was quite high and difficulties were mounting last year.
But under the leadership of the board and also supported by all the related parties, we maintained a stable result and tried to make progress in different factors. As Mr. Miao said in the report, in our annual report, that we are still who we are, and we have laid a solid foundation for the future growth. Mr. Miao also highly praised the board has highly recognized what we have achieved last year. Last year, I think that it seems to be a normal year, but actually, it was quite a difficult way to go. The results seem to be quite simple, but actually, it was hard to achieve that. CMB will try hard to maintain our results in the future. Just now, your question was about the balanced development last year.
According to the strategy put forward by the board, and we laid out our idea of building a value bank, it means that to provide value, creating value for shareholders, for customers, for related parties, for customers, employees, and also society. That is why we think among our business factors, we want all four business factors to move forward and also to reinforce each other among retail, corporate, and also investment banking and also asset management. But it doesn't mean that we have changed the main priority to retail banking. That is a very important thing. This year is the 20th anniversary of our launch of retail banking strategy. The first time we launched the strategy was in 2004. Now it's already over 20 years, about 20 years that we are doing the same thing.
That is why we have achieved very good results in our retail banking. 20 years was quite a hard period and was a long time. At the very beginning, we have the original computer, and we have launched the All-in-One Card and an All-in-one Net. That was all innovation from CMB. In the internet period, we become the All-in-one Net, and we provide services to customers seven hours every week and 24 hours every day. Then in the mobile time, we have upgraded our strategy to using mobile phones. Currently, we think we will continue to insist on our retail strategy. We will not change that. Only relying on retail alone cannot suffice.
If you only do one thing, you might be fast, but you cannot complement each other, which means that we need to be strong both also in terms of corporate banking and specialized operation of corporate banking and also strengthen our characteristic investment banking to create new growth points for our business. And also for wealth management, also asset management, these are the very major product lines. Otherwise, without these product lines, we cannot do very well in retail banking. That is why we say that these four business lines should all move forward. And this is in line with the trend of the international banks and also in line with the domestic banks. So last year, we have achieved quite good results, and these will continue to do so. And I think that by doing this, CMB can be a bank with our own characteristic.
By moving all the business units forward, we're not dampening our advantage in retail banking but make it even stronger.
Thank you. Next question, please.
Thank you for giving me this opportunity. I'm Katherine Lei from J.P. Morgan. I read from your annual report that your asset quality was quite stable even for real estate industry. Your NPL ratio has come down a little bit. But in 2024, when we look at the sales volume, it comes down and also both in volume and also pricing. So may I know, what is your expectation or forward-looking idea about the real estate sector? And also, do you think it will spread over to other areas such as microloans collateralized by real estate?
If the collateral's value comes down, what will be the impact on that and how we balance among the policies which ask or require the bank to support the real estate companies and, on the other hand, to ensure that the bank's asset quality remains stable? How CMB will balance on that? Thank you very much.
For real estate risk, by the end of 2023, our NPL ratio is 5.01%, up by 1.02 percentage points by the end of last year. But compared to June last year, sequentially, you can see that the ratio is declining sequentially. This year, I think the trend hasn't changed much. And for special mention loan ratio, last year, by the end of the year, was 4.7%, is down by 1.44 percentage points compared to the beginning of the year.
If we look at the NPL formation amount in 2023, it's down by 36.6% compared to last year compared to the year of 2022. This is our status or our risk condition in 2023. For our judgment for 2024, from the current situation, we think that probably, it's highly probable that our real estate NPL formation amount will continue to come down compared to what we have in 2023. At the same time, we will try to increase our efforts to dispose of the existing NPLs. So I think that asset quality will remain stable. This is, firstly, for our judgment for the risk management sector. For the risk that whether it will spread out to other areas, definitely, there will be pressure such as construction.
And also for the collateral you just mentioned, such as for the upstream construction, we see that in some regions, some enterprises, we have seen also defaults even in our own bank. And also for upstream and downstream of the real estate sector, we have done a special investigation into that. And we think that asset quality is all under control. And for how we implement the national policy and how we, namely, to satisfy the reasonable financing demand of real estate enterprise and also how to maintain the asset quality of the bank, I think our priority in 2024 will focus on three areas and to make sure that it's ring-fenced management on projects. Three areas. First one is that we will focus on our wholesale customers for our head office and branches. Secondly, to focus on first- and second-tier regions and cities.
And thirdly, is to focus on business that is supporting the rigid demand and to improve the livelihood of people, the demand support to focus on demand in this area. And on a project basis, we still emphasize on the self-fulfillment or self-repayment of the financing cost by the project itself, which means that it will mainly highly emphasize on the ring-fencing project management procedure. And we think that there's not much fundamental changes in the overall real estate sector risk currently. And one more online.
Now is the online Q&A session. Please press the more button if you're joining from mobile end and press the participant button. Please, we will have the question from Xu Ran from Morgan Stanley.
Thank you for giving me the opportunity of a question for the loan-growth plan and loan-pricing. We can see that loan-pricing tend to be quite competitive in the market. SME loan-pricing, especially. We also see from other banks that they may consider the trend to be not that reasonable, so they will tend to be slowed down in the loan-growth. So I would like to learn from CMB about your arrangement in loan-growth and loan-pricing and how to digest the risks in the mid- to long run and what is your plan's influence towards NIM. Thank you. Thank you for your question. I will take it.
To see from the year 2023 that CMB's loan growth tends to be stable. Our corporate loan growth, 9%. Retail loan growth, 8%. The overall loan growth was around 7%-8%. The speed is slowed down a bit compared with the previous years. Considering the external environment and the macroeconomic environment, I think that the investors and analysts mostly recognize that the growth rate is satisfying for CMB. We could fulfill the requirement to satisfy the need of the real economy and also take active consideration of the supply-demand relationship in the market. We are also faced with other questions such as the loan-pricing issue. Indeed, loan pricing also decreased last year. This is a common challenge faced by the whole banking industry and for CMB. Last year, the loan yield was down by 10 basis points for corporate loans.
Of course, the loan yield decreased more in retail loan, 42 basis points down. So on average, 28 basis points down for the general loan. Indeed, we have to recognize that they have cast influence on the bank's revenue. From the annual reports released one after another by the banks, we can see it's a common challenge faced by the banks. We need to conduct further analysis on the reason behind. First, it's about the LPR cut as we are faced by the repricing of the existing loan, regardless of our corporate loan or the retail loan. This is the common challenge faced by them. The second influence is brought by the supply and demand relationship. From last year, we can see supply in terms of asset side is way more than demand in the market. Therefore, the competition in the market is fierce.
The pricing and the cycle tend to be an influential factor. When the supply is higher than the demand, of course, the loan pricing will go down. The third factor is that beside the repricing factor, the supply-demand factor, our structure in the loan portfolio also matters. Our credit card and residential mortgage loans remain fast growth in the previous stage, and their loan pricing tend to be high among other types of loans. But for last year, regardless of credit card or residential mortgage loans, they are under multiple influencing factors. Therefore, their slower growth rate leads to lower loan growth and lower loan pricing for us. So to see our outlook in 2024, our strategy will continue to follow our long-adhering stable growth objective for many years. This has long been our goal to maintain stable growth.
So therefore, our total loan growth will be also set on a target of 8% to maintain a stable growth. And under such circumstances for loan-pricing management, we will maintain a balanced methodology. And firstly, it is highly aligned with the external environment. We shall take active consideration of the enterprise's financing cost. So therefore, we can provide reasonable loan pricing. And at the same time, we are able to conduct active management of our asset liability structure so that we are able to achieve a more reasonable asset structure and maintain a rather stable return of our asset yield. Even though I have to admit that we have made our every effort to achieve our goal, we have to still admit that the loan-pricing will continue to decrease in this year because of the reason of the supply-demand relationship.
Also in February 25th, there is a further LPR cut which leads to a further loan repricing of our residential mortgage loan. So the influence will gradually be manifested this year. And for the existing residential mortgage loan, there will be a one-off repricing in this year as well. So we will bear in mind the expectation, to lower the expectation for the banking industry, that the loan-pricing, that the loan growth might experience slower growth. We will have one more question from online participant. We will have the question from Mr. Ma Kunpeng from China Securities. Thank you, senior management. I have a question after I read the annual report in the chairman's statement that you mentioned about the differentiated development. And since last year, the banking industry is faced with a complicated operating environment.
I would like to learn from the chairman, what do you see about the external environment for the banks? In terms of differentiated development, differentiated and characteristics development, and how will the board of CMB provide support to CMB to sustain and realize such type of development? So for CMB, we have always emphasized to stick to be driven by innovation, to build up a leading model, and to feature a distinctive bank that is a value creation bank. Driven by innovation, only by doing so can we increase our core competency. Only by we use a leading model, can we enhance our capability in sustainable development. Only by developing a featured model, can we build our new moat to create value for employees, customers, partners, shareholders, and society. What did we mention about characteristics, distinctive characteristics? But CMB actually has very distinctive characteristics.
As we established, we strengthen to take deposit as our core, as our foundation. Later, we emphasize on building the retail bank as our core capability. Some of the peers, both CMB as the king of retail, that might be a high compliment for us. But we should also convey that we have a strong capability in retail banking. This is our characteristic. And now we are forging a new characteristic to increase our tech capability and build our new moat to bring CMB from the online CMB to smart CMB. This is how we aim to make our competitiveness stronger, make our customer service better in the market. We mentioned the four segments of balanced development. That does not mean that we have no longer distinctive features. We aim to maintain our distinctive features based on the balanced development of the four segments.
We shall maintain our existing advantages and characteristics. We will continue to take low-cost core deposit as our competitiveness. This is how we aim to maintain our good level of NIM. At the same time, we will continue to strengthen our retail finance. This can also contribute to CMB in terms of our sustainable development capability. At the same time, we propose to build the extensive wealth management cyclical chain of value. This is also in line with the wealth management and the retail finance development. Last year, we have experienced challenges such as sluggish capital market and also the fee cuts. There might be some influences casted on our wealth management business. However, we don't see a lower proportion of net fee and commission income, net interest income, net non-interest income in terms of our total income.
We have also aimed to increase a higher level of AI application in the banking operation. This can even make our characteristic more distinctive and make our capability to build sustainable development stronger. It's not just a slogan. It has very rich, detailed content. It is how we build our new moat based on our past strengths. Thank you, Chairman Miao. We will have another question from onsite. Dear senior management.
I have a question. I'm from CLSA. My question is for Mr. Wang. It's the first time you have disclosed the key branches in key regions. And you have disclosed data relating to that and saying that you want to build up a new growth engine. So Ma'am, what is your thinking for that? And is there any progress on that? And what is the potential for that?
Thank you very much for your question. Actually, for business units, we think that retail is our top priority. And also, we are thinking about what are the aspects that is in line with the overall economic development of China and what areas will be our new growth engine. I think a very main characteristic of China's economy is the diversification in different regions.
Major resources are even more concentrated in key regions like in Pearl River Delta, like in the Bohai area, like in the Chengyu area, and also like the Haixi area. These are the major strategic areas for China and have great potential. According to the regional strategy, we will continue to invest more into this region and hope that our branches in this region can contribute more to the whole bank. Our major policy is to we will invest more, give more resources to the branches like the capital, like human resources, like credit resources to these regional branches. We require that with a precondition that risk should be under control, that these regions should implement the strategy of the bank.
Namely, these regions are areas where they have a great potential for retail and have a great potential for more population, and also have more potential for new economies and how they can implement the new productivity industries. And also into retail business, we have set targets for them, higher targets for them than the bank's average level, and hope that they can be faster compared to the average and to implement the national strategy by giving them more resources and setting up higher targets. We hope that by several years, that these banks can contribute more to the bank's profit and also to build up a better engine for CNB's overall growth.
Thank you. And next question, please. Thank you, Mr. Wang Xianshua from Guangfa Securities. My question is quite simple. Now, it's already at the end of the first quarter.
We have done investigation that banks are under pressure. But I know that different banks differentiate from each other in the operation for first quarter. So Ma'am, could the management give us some expectations on the first quarter? What are some negative and positive changes? And more direct question, whether you can maintain a positive profit growth in your first quarter.
Thank you very much for your question. Your question is very direct, but my answer could not be very direct. Actually, I want to say that in the first quarter, we really feel that the pressure is higher and haven't turned better compared to last year. Why is this so? Last year, there were many policy causes, and policies are reflected in the first quarter of this year, such as for the repricing of the existing mortgage. The new policy was started from September last year.
So that was affecting only one quarter last year, but it will affect the whole year this year. Secondly, to the decrease of the fee rate for insurance that was in October last year, it was also affecting only around one quarter last year, but it will affect the whole year for the bank and also for agency sales fee of the mutual fund. It was also launched by last year. This policy will also the impact will also be shown in this year. And also the reduction of LPR and even 25 bps down for the five-year LPR. All these policies all compounded together will have laid pressure on this year's growth in operating income and also on profit. And under these circumstances, to realize positive profit growth, I think, as you have wished, is really a big challenge.
For us, on the one hand, we want to—I think one of our advantages, namely, is the low-cost deposit. We want to maintain this as our main advantage in the funding cost side. Last year, for deposit growth, it was very obvious for the trend of term deposit. And at the same time, for U.S. dollar deposit, the rate was increasing. So aggregately, you can see that the compounding deposit cost ratio was up last year. But actually, if you look at the only look at the R&B side, it's still under control from the cost. And this year, that is why we will continue to maintain the deposit cost. And secondly, it's from the asset side, as you say. There's an oversupply of credit, and pricing was quite distorted. And for some clients, their loan rate is even lower than the deposit rate provided for them.
It's not sustainable. This reflects the supply and demand situation of the bank. Banks need to have more effective allocation of assets. That is why we will maintain a higher proportion of retail banking. Retail banking's yield is higher than corporate side. That is why we make more efforts in microloan and also in consumption loan so as to offset the shortfall coming from the yield side. In fee-based income, we try to make fee income in different assets such as asset management, custodian business, and also financial investments by different means to maintain our fee-based income, so as to offset the policy negative impacts.
And we want to increase our efforts in terms of cost control and to, as the board has required, that is a tough time to tighten our belt and to cut costs and improve efficiency and to increase our by taking all these means, we hope that we will try our best to realize our own profit target. But as what you have wished for, it was quite a difficult and challenging task for us.
Thank you very much. I'm from Goldman Sachs, Claire. You just said about the fee-based income. My question is about the fee rate for insurance and also fee rate for agency sales of mutual funds. And could you please also give us some more detail for our forward-looking on fee-based income? And from our own will, we do hope that you will not continue to come down.
But actually, whether there will be further room is according to the new policy.
So it's not up to us. And yeah, I would like to elaborate on the fee income. And just now, Mr. Wang Liang has also introduced to us the policy factors, the major impact on our fee incomes, including insurance and also including on mutual funds. These are the main two factors affecting our fee-based income. And currently, we think that the impact is quite big. But whether there will be further room for the rate to come down, we do hope that this rate will continue to be stable. And for fee-based income, I would like to give you more introductions. Last year, for banking industry and also for CMB, are all facing great pressure in fee income.
For CMB, we are having even a bigger income compared to a bigger impact compared to our peers. It's down by 10.18%. It was quite a big decline. The main reasons are as follows. The first one is from mutual fund, agency sales mutual funds down by 21%. Second one is coming from the sales of the wealth management products down by 18%. And also the agency sales of trust products is also declines over 10%. And also for asset management and custodian business, are all declined by 8%. Only one highlight last year was around insurance. It's up by around 9.33%. So that was the only increase for fee income.
And behind that, you can see that the sales volume of the insurance has increased by 33%, which means that by increasing the volume of sales volume to meet up the shortfall in the decline of fee rate, this is for our insurance business. And I think that the business increase slowdown will also lead to a decline in the income, such as for wealth management business. The daily average sales volume is coming down. And it's one of the reasons why the total income was coming down. And such as for custodian business, the total volume for equity products under custodian is also coming down, which lead to a decline in all fee income. And for our wealth management products, even though we are still ranking first in terms of the total transaction volume, but structural change has also caused the decline in the overall fee income.
Last year, we all know that the capital market has caused a negative impact on equity-related products, such as for mutual funds. Equity-related funds sell quite difficult. And also for custodian business, also the same, that the products relating to equity under custodian, the overall volume is also coming down. And these are all structural problems. And thirdly, is the policy impact, such as for fee rate card and also for the new policies on the policy side. These are the three factors. First is the volume growth is slowing down. Second one, structural problem. And third one, policy are all leading to the difficulties in fee income for wealth management. But there are also positive signs. The first thing is that for capital market, we think that if we look ahead, we haven't seen a very strong rebound in the capital market.
It will continue to impact on fee income. And also from the demand side, I think that we are also not seeing very strong demand for wealth management products. But there are some positive signs, such as for the overall economy, the overall GDP target rate is around 5%. And I myself was quite confident about that. And secondly, for the capital market, it's still building up the bottom. I myself hope that it will rebound. And also there are structural opportunities for the debt market and also for the bills market. So these are also positive signs that we have seen, which might have some positive impetus for our fee income. And internally, I think that there are several opportunities we need to seize. And the first one is the customer growth, customer-based growth, including corporate banking customer and also for retail banking customer.
By customer-based growth, it's where fee income comes from. So it's the origin or source of all the income. So this is the top thing, top priority we need to focus on. Just now, as Mr. Wang Liang said, our AUM growth rate was quite good this year. And this is the foundation for the fee rate for our wealth management. And very importantly, how we can better serve our existing customer and provide value for our customer. That is the way that we can improve our fee income. And secondly is the product structure, such as for insurance products, even though fee rate is coming down. But we do hope that we can increase volume so as to offset some negative impact coming from the fee rate.
We will step up our efforts, such as for the dividend payout ratio, dividend payout insurance, and also protection-type insurance to improve the sales volume of this kind of insurance by optimizing the structure and also by making progress in terms of customer-based growth so as to minimize the impact coming from the policies.
Thank you, Mr. Peng. We will have a question from online participant. The question will be coming from Zhu Chengxi from Guotai Junan Asset Management. Can you hear me?
Dear Senior Management, good morning. I am Zhu Chengxi from Guotai Junan Asset Management. Thank you for giving me the opportunity. My question is about asset quality. I noticed that in the previous economic downturn, except for the real estate sector, for corporate banking business, other corporate loan actually remained stable for CMB. Actually, the economic environment is not that optimistic. So I would like to learn more about the corporate loan in terms of its asset quality, in terms of its detail, and what is your outlook?
Thank you for your question. Well, indeed, the economic downturn, we are faced by some new challenges and pressures.
As for the real estate risks I've addressed and responded, and for the corporate banking aspects, we have a rather large type of asset that is manufacturing loans. We have a total scale actually increased quite a bit for the past two years and totaled CNY 550 billion in total. By the end of 2023, our manufacturing NPL ratio was 0.59%, recorded a decrease compared with the end of last year, mainly focused on the traditional retail, wholesale, and manufacturing. Our focus in this round will be focusing on several aspects to strengthen our capacity building. The first is that through industry specialization, we increase our recognition and quality client selection in the industry. Secondly, we focus on one policy for one branch and name list-based operation to strengthen our operation and management of risks of our middle-level clients.
And thirdly, we enhance our post-loan data risk warning and also relevant management. At the same time, we enhance risk classification and existing of this type of clients and also our risk inspection efforts. So the overall risk is controllable. And at the same time, for some industries under key management, it's mainly focused on 14 industries. To see the total volume, it also decreased compared with the beginning of the year. So the overall risk is also decreasing. We stick to the name list management, which is proved to be very efficient and the focus on the strategic plans of the head office and branch level and the focus on the name list-based management to strengthen our overall control of risk. And therefore, the risks generally decreased. We expect in the year 2024, the risk management can still maintain stable. This is my response. Thank you.
Another question from online. We have the question from CITIC Securities, Xiao Feifei. Thank you for this opportunity. I have a question regarding the structural reform, your organizational reform. I noticed there are some changes in the retail banking sector. So in the organizational reform, what is the influence and what is your planning towards this transformation? And what's its influence over the asset quality?
So in January this year, the retail banking sector, we increased a department called the Retail Customer Base Group department. It is newly established according to customer's demand. And its responsibility is to serve the retail clients except for those of private banking customers. And for the retail banking general office, wealth platform department, and also private banking departments, we have conducted some amendments to their responsibilities.
We aim to optimize their responsibility, focusing on customer-centric philosophy to cater to the increase of our total volume of 197 million retail customers. There will be another increase in this year, very fast increase. And how to better respond to these clients, we believe, will be relying on our organizational changes. We believe that the previous model, the previous organizational structure, can barely respond to the demand from our customers. We also rely heavily on online-based operation and also intelligent management to better reach and cover our clients and respond to their needs. I think that through this structural reform, it will be a better chance to enhance the service capability of the head office and optimize the responsibilities and duties of each department and to strengthen the strategy development of the retail banking sector.
This optimization has proved to be quite good after several months of operation. For the past two years, in the head office level, other business lines, other business departments, including the CMB branches, have also made flexible and active adjustments according to the requirement of business. We have also conducted those adjustments in a smooth manner to avoid big influences to our business. For instance, we established a new department called the Inclusive Finance Department to further promote the development of inclusive finance business and now having a balance of CNY 800 billion and serving over two million inclusive finance business. These have been embedded in our development philosophy to better serve our clients. We established a new department called Cross-Border Finance Department to better serve the cross-border finance demand for our corporate customers.
For the past two years, the cross-border finance business also developed a lot against the market trend, ranking top among our banking peers. We have also conducted the comprehensive branches to make our branches as a force to pioneer in the market. We resume what we have been doing in the past that let the branch, the sub-branches, to be the force, very emerging force to manage in the market. These changes in the structure, in the organizational structure, can better serve our customer, to better respond to them, to build up our capability, to provide our service, and also our efficiency per capita. Our sense of loyalty and recognition of our staff also enhance along the structural reform. We conduct this reform in a smooth manner without having large influence on the business operation.
It is aligned with our strategy of our overall development plan. This is what I respond to your question regarding the retail structural reform. This is all about how we are able to promote our business, how we are able to align better with our development strategy, and how can we respond better to our customer-centric philosophy.
Thank you, President Wang. Now, we will have the next question from an onsite participant. Thank you, Senior Management. I am Guotai Security, Zheng Zhen. I have a question regarding asset quality. I would like to ask this question to Mr. Zhu. I've noticed that the external environment, that the residents have been showing sluggish and rather weak demand in terms of residential mortgage markets and also in the retail sector.
I would like to learn more about the Senior Management, about your assessment in this field, and what other sectors do you observe that will be upticking of risks? I have also noticed the higher migration rate of the substandard and the doubtful loan. I would like to learn about the reason behind it. Is it some active arrangement conducted by the bank, or is it about some other factors?
Thank you for your question. About the risks in the retail finance sector just now, about the residential mortgage loan by the end of 2023, the NPL ratio was 0.37%, a little increase compared with the beginning of the year. However, we are lower than the average level of our peers. To see from the NPL formation, that is 0.22% remaining flat compared with the beginning of the year.
So in terms of residential mortgage loan, the overall risk is, we could say, at a low level. So to be specific, the residential mortgage loan, as a proportion, we can say that 87% of the assets are located in Tier 1 and Tier 2 cities. The risk-weighted collateral ratio was 32.93%. And to see from our stress testing results, under the medium level, the NPL ratio will increase to 0.66%. So generally, the risk is at a controllable level, at a low level. To be specific, in the small and micro-sized loan, the NPL ratio was 0.61%. The NPL formation ratio is 0.52%. So generally, we both record year-on-year decrease in the two ratio. We also observe that in this perspective, we are faced by insufficient effective credit demand and weak social expectation. And there are also some hidden risks.
These are all influencing factors we are faced by. We will further enhance our strict risk classification and onboarding of our customer. This is what we will do about microfinance loan. The third aspect is about consumer finance loan. Our consumer finance loans NPL ratio was 1.09%, and the new formation ratio was 0.9%, uptick from the beginning of the year, which is aligned with the overall market condition. For CNB, the consumer finance loan, our customer base is focusing on three types of customers. One type is our payroll customer. The second type is our customer from quality industries. The third type is top-tier enterprise in specific industries. Generally, the consumer finance customers is not that same with our credit card customers. The risk manifestation is also different from that of the credit card.
As you can see, the NPL ratio formation, one is 0.94% and one is over 4%. So it is quite different. Consumer finance loan yield is better than residential mortgage loan and also better than the microfinance loan. This is about consumer finance. The last part is about credit card. But at the end of last year, credit card NPL 1.75%, NPL formation 4.52%, both record decrease compared with the beginning of the year. However, the NPL formation indicator is higher than that of the pandemic era. 4.25%, we will have to admit, is at a high level. So after we made some amendment to our credit card strategy, the trend is also showing a decreasing momentum. And this is the general condition for our retail finance business. So looking into the year 2024, the overall risk is controllable and remains stable.
This is your first question, my response to your first question. The second question is about the sub-level and doubt level migration level. There is a policy factor that is since July last year, our asset classification new rule is now coming into effect. 27 days and above loans will be migrated to the doubtful. For those over 360 days, we will be recognized as lost. So according to the regulation, we will implement according to the requirement. And we have conducted relevant migration arrangement and therefore showcasing the higher migration ratio regarding the sub-level and doubtful loan. It is mainly about what we have been implemented according to the regulatory requirement.
Next question. I'm Gary from HSBC. My question is for Chairman Miao. In the past two years, many foreign investors, actually, they are lowering down their shareholding in Chinese banks.
So how do you think that you can help to increase the interest from overseas investors for the ROE and also your RWA growth rate? What is your long- and mid-term target for that? Thank you very much for your concern for China Merchants Bank. They have written me a note for that.
Thank you very much for that. The first question is for the number of the shareholders is coming down, whether we have any approach to increase the interest from overseas investors. I know there are many factors for that. How can we be more attractive to foreign investors? Firstly, is to increase our own value, to increase our value no matter it's for domestic investors and also for foreign investors. They can earn money, or they can have return from us because capital is chasing profitability.
As long as we are profitable, I think the foreign investors, they don't care whether the money is making from which market. So a fundamental way and a key way is to improve our return for investors. That is why we are saying we want to build us into a value-creating bank, including creating value for investors. Secondly, of course, we need to improve our communication with foreign investors. There are many reasons why foreign investors are decreasing. They're increasing China. There are some misunderstandings, especially due to last past years, due to the COVID control. Communications have been reduced since we cannot go out, and foreign investors were not able to come into China. So there were a lot of misunderstandings due to less conversation. So last year, we are the first to go to different markets, including the U.S. market.
We are doing a roadshow there and have to have face-to-face communication there. And I think the impact is good because buying shares, overall speaking, is buying future. It's not buying the current. So improving the confidence of shareholders is very important. It's very important. So where does confidence come from? It depends on communication, especially for the domestic market in mainland China. It's a long way from the Western markets. So I think that face-to-face communication is the best way for us to improve communication. And that is why we are doing a roadshow last year. And in the future, we will continue to do so. So this is for your answer for your first question. Secondly, for continuous ROA and ROE. And I think banks are facing cycles, and also ROE are also facing cycles.
Years ago, U.S. banks are also facing a zero-interest rate cycle, and their ROE was quite low. Last year, they were going into the rate hike cycle as improving. I think that for CMB, ROA and ROE, we are quite high among our peers. Just now, ROA was 16.22%. ROE was 1.32%, and ROE is over above 16%. So we hope that even during the downward cycle, we can maintain a stable ROE and ROE. And as long as in the downward cycle, if we can maintain a stable, more stable ROE, even though it might come down a little bit, but definitely, I think we need to be better performed than our peers. So our target is to outperform our peers and to outperform ourselves. And in the upward cycle, we can perform better than our peers.
So no matter it's a downward cycle or upward cycle, we are better. We can live a better life than our peers and have a better return for our shareholders. So our shareholders will be satisfied around that. Our customers, employees, and society will all be satisfied with that. Thank you very much. Due to time constraint, and we also need to guarantee the interest of individual investors. So we have a question from individual investors. Many questions raised were quite the same as what we have just asked. And I think that our employee will also read out one question from an individual investor.
A question from individual investor from China Merchants Bank Corporation, whether you are seeing some recovery in the demand from retail customers' demand. And what is your forward looking for the growth rate of retail loan demand? Thank you very much.
From our retail loan growth, consumption loan, actually, there are three business products. One is our credit card. Last year, it was a growth around over CNY 50 billion. And also our retail banking department is also doing consumption loan. It's growing by around CNY 100 billion. And also under us, we have a JV. It's CNB, a consumption with last year, their asset volume around CNY 180 billion and grown by around CNY 10 billion last year. So all these three parts are growing last year, but with a different speed because they have a different risk-reward, risk pricing. And also they're targeting different customer groups. And I think, overall speaking, with the recovery of the consumption, our consumption loan is also growing.
Why the growth rate is different, such as for our JV, for the consumption loan, they are targeting at a lower level customers, which means that they are facing higher risk. That is why they are having a lower rate of growth. For retail loan, we have a higher growth rate because they are having the best customer among the three parts. Their NPL ratio is around 1.09%, and the growth was around CNY 100 billion. It's more targeting at the quality customers, and they have strong capability of repayment. For credit card customers, it's quite in between the above-mentioned two types. So this year, within our consumption loan, the growth will be quite the same as what we have last year. Speed might be slower, but amount will be stable.
So that slowing down, a little bit slowing down, will help us to better control the risk, namely making an adequate or reasonable growth rate and also, at the same time, maintaining the asset quality and also taking into consideration the return on the asset yield and also to satisfy the consumption demand. Thank you. And I think the next, okay. And the last 20 minutes will leave to the media friends. I think one question from online.
Thank you for giving me this opportunity. I'm from China Economic Net. Just now, you have some question about retail. Yeah, you said that CMB's advantage in retail banking businesses are even more stronger. So I would like to know your view on the development of retail banking business this year. And just now, you said about the retail loan.
You said that you are still going to grow the retail loan this year. But you also mentioned about the concern on the asset quality side. And other banks saying they want to learn from China Merchants Bank in terms of retail, but also thinking about there are higher risks in the risk asset quality side. So the other banks are also moving towards more quality customers. So my question is for what is the change for CNB's strategy for retail business, retail loan business? And in retail business, do you have any indicator that can show your leading advantage in retail business?
Thank you. Thank you very much for your question. You just said that how CNB can have a better advantage in retail banking business. And I think that for the retail banks in China, there's still great potential in the market.
China has a population of about 1.4 billion and around 400 million middle-class customers. I think there will be more coming to the middle-class level residents. This means that a great potential for retail banking business. That is why every bank is laying high emphasis on that. For CMB, for the past 20 years, with the accumulation that we have made, we need to seize the opportunity. I think for CMB, the two opportunities are in the four areas. The first one is wealth management. With the increase of the residents' income, there's need for wealth management means opportunities. This is the opportunities we have. The second one is for AI, artificial intelligence.
A bank, especially in wealth management or retail banking business, if it still relies on the physical outlet or the relationship managers, it cannot survive customers' demand for more efficient and more smart customers. So we can only rely on ITs like the AI technology. CMB is strengthening efforts in these two areas and has made leading advantage on that. In wealth management, we want to build the extensive wealth management value chain and also to improve our capability to create value for customer and also risk management for our customer and to build the ecosystem for our partners and to provide better return and better product to our customer with our counterparties. So this means good wealth management. We have achieved quite good results on that.
For digitalization and AI, with the support of the board, we have also set up an earmark fund for financial products and increasing our investment into fintech. Last year, investments were around CNY 14 billion. This has been so for many years, namely no less than 3.5% of operating income for technology. This is written in our memorandum of articles. This investment into technology has helped us to have a fundamental change in how we service our customer. Last year, I think our IT department said that we have saved around 117,000 full-time employees saved. Last year, it was around 20,000 full-time employees was saved. By using this technology, we have improved the efficiency of how we serve the customer.
We'll have an onsite participant. Dear senior management, I am Ma Chuanmao from Securities Times.
I have a question regarding the chairman's statement to forge a core of a smart CNB to be the new moat. I would like to understand more about the proposal. Will it bring more changes in our IT input? And what phase-based goal has CNB established in terms of such development? And how will you conduct inspection to check whether we have achieved the goal?
Thank you for your question. Just now, I've mentioned this question in answering the previous question. As you may have all known, the development of AI and LLM, we could say that they have brought great influences and the potential to the financial industry. For CNB, in terms of AI, we especially established an AI lab and established a team of hundreds of personnel to promote AI application and to focus on cooperation with leading companies in the AI industry.
On the one hand, we aim to enhance our capability in terms of AI application. From current observation, we can see that within the industry, the bank has been quite leading in the position in terms of such kind of application. On the other hand, the wealth management smart customer assistant, AI Xiao Zhao, can realize interaction with our customer based on the LLM, the large language model. We have enhanced our capability in smart context and also RPA to relieve our full-time staff from the repetitive work. Our 945-955-55 hotline to provide remote customer service is further enhanced in terms of capability. We aim to further enhance its level of standardized service providing. For those questions that are hard to be taken and handled by RPA, intelligent customer service, those will be given to our manual work.
We believe these have been all proved to be quite efficient in improving our efficiency and relieve as many as 17,000 full-time staff in terms of using those AI application smart operation. This is what we talk about online operation. We could say we basically realize online-based operation in all kinds of business. The second aspect is about database in terms of our core asset management. The third aspect is about a smart operation to increase our accuracy of marketing, lower operational efficiency, and increase the quality of our service to build a five engine: the smart engine, wealth management smart engine, operation smart engine, risk management smart engine, customer service smart engine, and also marketing smart engine. The five smart engines is what we aim to further forge. Also platform-based management. By the end of 2022, we have realized a full-scale cloud deployment.
By doing so, we aim to forge a very consolidated foundation of our technology. Based on our cloud deployment, we forge our SciTech platform, our data mid-office, and the tech middle office. This is our upper limit that further free up our upper limit to further iterate and realize agile development and iteration. This is where the bank could further adapt to the development of digitalization. The next one is about ecological development. We cannot rely on solely some independent product offering to survive. We need to develop based on scenario-based services and solutions to embed financial service into daily life offerings such as meal ticket, smart transportation, utility, convenient payment. These scenarios have all been welcomed and recognized by our clients. The CMB application has already got a MAU of 117 million users. Around 20 scenarios have a MAU of over hundreds of millions of level.
We embed different kinds of financial services into daily life scenarios to enhance the further integration of other scenarios into financial services. The five directions of development further enhance our development in terms of digital transformation along with our full-scale cloud deployment. And these all contribute us from transforming from online CMB to smart CMB. And these could also contribute to CMB to be a modernized bank, a company that is under modern corporate governance. That is what advantages brought by technology to us.
Thank you, President Wang. Another question from the onsite participant. Thank you, senior management. I am Tang Zixiao from the 21st Century Business Herald. I have a question regarding the extensive wealth management strategy. You mentioned that the year 2021 is the first year about extensive wealth management.
But due to last year's policy issues such as fee cuts in the bond management and policy distribution fees, I could also see that these unfavorable factors were responded to by CMB with some structural changes, internal organizational changes. I would like to learn more about your understanding towards this trend. And how will you respond to that?
Thank you for your question. The extensive wealth management strategy is established based on our understanding towards the changes of the wealth management business. This is what we propose as a strategy. This is in line with what our chairman mentioned about the development and enlarging of our capital-light business and strengthening our capital-heavy business. The wealth management business is the core of our capital-light business, which includes wealth management, asset management, asset custody, and etc. So in this perspective, CMB has already established our strengths, our wealth management scale.
The retail AUM is amounted to CNY 13.32 trillion, the asset management level including CMB wealth management, CMB leasing, etc., totaled CNY 4.5 trillion, which rank among the top in the banking industry. As for asset custody scale, we reached CNY 21 trillion, which is the largest among all banks in the industry for CMB. In these sectors of extensive wealth management, we have to admit it is what we have already achieved. We have to see the great potential in the wealth management market of the Chinese market. We have also achieved advantages and achievements in advance because of our careful and forward-looking assessments. We consider this area will still be obtaining great potential for Chinese FIs, for China's financial structures. We can still see that the credit demands, the credit-based financing is still the core, the majority of the banking business in the future.
We aim to see and construct a more reasonable structure of the financing market and to see higher proportion of contribution coming from the capital market, especially for asset management. We see there will be fast development in this area. If we can adapt to this trend, if we can seek progress in these areas, if we can maintain our leading advantages, we will obtain more prospect to develop in the future. We can also further learn from the international banks to strike more balanced development among all business segments, as mentioned earlier in the previous response about our balanced development achieved in the four business segments. Extensive wealth management, well, at current stage, is under the influence of the policy factor of the capital market's downturn. It is undergoing some pressure. However, extensive wealth management, the path might be swerving, but the future is bright.
We will stand firm to our choice. Well, just now, you have also mentioned the question about setting up a new department about the retail customer-based department. This is a response to our organizational structural adjustment and also what we live up to our philosophy of taking our customer at the center so that we set up such a department to provide services to retail customers except for private banking customers. It is just an optimization of our organizational structure to better adapt to our arrangement and responsibility fulfillment of the retail banking sector.
We will have the last question. For the media friend from onsite, this lady, please. Dear senior management, I am Grace. I would like to learn more about the NIM around 25 bps lower. What do you expect about the NIM decrease? And what is the rate of decrease?
Can you share more about your view about the market interest rate? Thank you.
Thank you for your question. Well, I was not expecting the last question to be the question about NIM. So I will take the question. About NIM, that is definitely a question that many of you may pay special attention to. And you may also notice it's a common challenge faced by all banks. NIM is a common challenge faced by all banks, 25 basis points cut for CMB. No matter the decrease or the decrease rate, CMB, we could say, maintains a relatively good level among our peers. We have strived every effort to achieve such a goal. And maybe I see that the more you care is about the trend. And I would like to learn more about I would like to take this opportunity to explain further.
NIM definitely will be further put under pressure. I've been answering this question for many times. For this year, the response will be the same. However, except for the decrease as a fact, we should still pay attention to its pace. For the existing residential mortgage loan repricing, a pressure will be relieved in September this year. The LPR rate cut 25 bps lower will also be further released in this year. And of course, the dual factors will contribute to further decrease of the bank's NIM. We also see quarter-on-quarter mitigation in terms of the decrease in terms of the NIM. We can also see from the example of last year, there is a decrease from 2.3% to 2.04%. There's a trend in the year 2023. Quarter-on-quarter, we could say the things might be better compared with the year 2023.
Year on year, we could see the decreasing trend will be still there. For the first quarter, the NIM pressure is the highest. The NIM for 2024 might be already at the bottom for the future several years.
Thank you for the questions from our participants. Due to the time limits, CMB 2023 result announcement will now conclude. For more details, information, data, you may refer to our annual report that is released on the website. For more other questions, please feel free to contact our IR team of the board. Thank you very much for taking part in our annual result announcement. Thank you.