Ladies and gentlemen, friends from the media, good morning. Welcome to the 2024 annual results presentation of China Merchants Bank. I am Xiao Yangf ang, General Manager of the Office of the Board of Directors. CMB has announced our 2024 annual results on Tuesday evening. Today's event is being conducted both offline and via live webcast. I would like to introduce the participants of today's event. They are Mr. Miao Jianmin, Chairman of the Board; Mr. Wang Liang, President and CEO; Mr. Peng Jiawen, Executive Vice President, CFO, and Secretary of the Board of Directors; Mr. Zhou Tianhong, Chief Information Officer. Also joining us today, both onsite and online, are Mr. Zhu Liwei, Non-Executive Director; Mr. Shi Yongdong and Tianhong Qi; Ms. Li Jian, Independent Director, Independent Director, and Non-Independent Director, as well as department heads from relevant departments of CMB.
On behalf of CMB, I would like to extend a warm gratification to your participation and thank you for your long-term support. Today's event, I will first invite Mr. Miao Jianmin and President Wang Liang to first review our results highlight, and then we will enter into the Q&A session. Simultaneous interpretation in both Chinese and English will be provided. I would like to give the floor to Chairman Miao and President Wang. Dear investors, analysts, and friends from the media, good morning. Welcome to CMB 2024 result announcement. Today's result presentation will be divided into three parts. First, I will give an introduction over the company's 2024 results highlights, and then President Wang will give a brief introduction to operational information. Finally, I will briefly address our outlook and strategies for 2025.
In 2024, facing the complicated external environment, the group took the strategic target of building a value creation bank, taking active measures and comprehensive policies, and realizing steady operation with good momentum and even more distinctive features and more significant advantages, and realizing dynamically balanced development of quality, profitability, and scale, which was reflected in the following six aspects. Firstly, we effectively respond to multiple challenges with operating results steadily improved. We withdrew challenges such as insufficient effective credit demand, declining interest and fee rates, intensified competition in the industry, and capital market fluctuation. Our full-year net profit recorded positive growth, and ROAE remained at a high level. Our net operating income was RMB 337.12 billion, while our decrease was 0.58%. Net profit attributable to the shareholders of the bank was RMB 148.39 billion, while our increase was 1.22%. ROAE was 1.28%.
ROAE was 14.49%, while our decrease was 0.11 and 1.73 percentage points. NII was 211.27 billion, while our decrease was 1.58%. NIM was recorded at 1.98%, while our decrease was 17 bp s. Still maintaining a leading position in the industry. Net non-interest income was CNY 125.84 billion, positive growth, while our increase was 1.15%. Cost-to-income ratio was 31.92%, while our decrease was 1.05 percentage points, showcasing effective cost reduction and efficiency management. Maintaining stable growth in asset scale would be the second point, and we continue to strengthen liability advantages. We actively respond to market competition and persist in increasing effective asset origination, optimizing our structure with liability costs significantly reducing. Total asset exceeded CNY 12 trillion, an increase of 10.19%. Total loan and advances to customers was CNY 6.89 trillion, up by 5.83%. Total liability exceeded CNY 10 trillion, up by 9.81%.
Total customer deposits exceeded CNY 9 trillion, up by 11.54%. Interest-bearing liabilities' average cost ratio was 1.64%, yield year decreased by 9 bp s, maintaining an outstanding level in the industry. Thirdly, we maintained good asset quality with strong risk compensation capability. Our MPL balance was CNY 65.61 billion, up by CNY 4.03 billion. MPL ratio was 0.95%, remaining flat with the year-end. Our allowance coverage ratio was 411.98%, a decrease of 25.72 percentage points. Allowance-to-loan ratio was 3.92%, down by 0.22 percentage points. We maintained robust risk compensation capability. Credit cost ratio was 0.65%, a year-on-year decrease of 0.09 percentage points. Fourthly, we continued to optimize income structure and maintain endogenous capital growth. Our net non-interest income's proportion continued to increase, reaching 37.33%, up by 0.64 percentage points year-on-year.
Retail finance contributed more than half by value, with net operating income and profit before tax from retail finance accounting for 58.37% and 50.74%, respectively. We have an industry-leading level of cash payout ratio. Our plan for 2024 was cash-dividend payout ratio 35% above. Dividend for every share was CNY 2. We will conduct intermediate cash-dividend payout this year. Our CAR at all levels continued to increase. Quarter 1 CAR, Tier 1 CAR, and CAR were 14.86%, 17.48%, and 19.05%, up by 1.13%, 1.47%, and 1.17 percentage points compared with the year-end. Under the weight measurement approach, our Quarter 1 CAR, Tier 1 CAR, and CAR were 12.43%, 14.63%, and 15.73%, up by 0.57, 0.81, and 0.77 percentage points compared with the same period of last year. Fifthly, we further increased input in technology and accelerated to build a digital and intelligent CMB.
We adhered to IT empowerment philosophy and maintained our IT input. In 2024, our input amounted to RMB 13.35 billion, 4.38% of the bank's net operating income. We have over 10,000 R&D personnel, accounting for 9.3% of our total employees. In recent years, we have seized the opportunities arising from the rapid development of AI and built our core competitiveness around AI Plus finance, which is mainly reflected in the following aspects. Firstly, we started early in AI. As early as 2017, we have established our AI lab to follow the future development trend of AI technology, increase our resource input, and tackle key challenges and make breakthroughs. Secondly, we have strong in-house R&D capabilities with a leading model.
We have independently developed a new generation of intelligent computing infrastructure and put into operation large model arithmetic clusters composed of thousands of computing models and released the first open-source financial AI model with tens of billions of parameters in domestic banking industries, Yizhou. Thirdly, we have comprehensive large model architecture. We have built a full-tier architecture covering infrastructure, models, AI middle office, and large model application, which features full-stack large model capabilities and builds an intelligent bank foundation and reduces the cost and thresholds of AI application and development. Large model technology has been widely used across the bank, with over 120 application scenarios. Sixthly, we proactively implemented ESG concepts and provided financial services to the real economy. We improved our corporate governance mechanism and fully integrated ESG philosophy into our management, enhanced sustainability development capability, and our MSCI ESG was upgraded to AAA level.
We actively participate in climate governance, improved green investment philosophy, and policies. Our green loan and green leasing balance increased by 9% and 19%. We have released the first climate change mitigation-themed green bond among all Chinese banks. The funds raised from the bonds mainly support industries such as energy conservation, environmental protection, clean production, and other sectors, enhancing our own carbon management capabilities. We actively fulfill social responsibility and provide further support to the real economy to support people's livelihood. Loan-to-key sectors continue to increase, and we continue to enhance our financial accessibility. The information security and privacy protection and consumer rights protection. The above is my brief review of the performance in 2024. Now I'll give the floor to President Wang on the company's operational performance. Thank you, Chairman Miao. I would like to introduce the company's 2024 operational information.
In 2024, the management has acted in accordance with the BOD and stuck to the strategy of building a value creation bank and established a high-quality development model driven by strict management, fundamental principles, and breaking new ground, and overcame the impact of multiple unfavorable factors through a multi-pronged and multi-measured approach and achieved good results. This is mainly reflected in the following six aspects. First, we optimized asset liability management and achieved continuous growth of business scale. In face of insufficient effective credit demand, LPR cut, adjustment of interest rates of existing mortgages, and deposit trend towards more deposits, we strive to optimize our AL structure, strengthen deposit cost control, and realize a stable growth of both deposit and loan, and our deposit costs decreased significantly. Total loans and advances accounted for 56% of total assets.
Retail loans accounted for 52.91% of total loans and advances, an increase of 0.09 percentage point. Investment assets balance increased by 15.47%, accounting for 30.5% of the total. The ratio of total deposit to total liability was 83.31%. Balance of demand deposits accounted for 52%. Average daily balance of core deposits accounted for 86.24%, maintained at a high level. Customer deposit cost ratio was 1.54%, down by 8 bp s. Second, we vigorously developed fee-based business with a higher proportion of non-interest income. We strive to overcome challenges, study more on the market to grasp opportunities, to receive gradual change on our net non-interest income. Net non-interest income increased by 1.15%, accounting for 37.33% of the revenue, up by 0.64 percentage points. Among them, net fee and commission income decreased by 14%. Other net non-interest income increased by 33.37%.
Influenced by the fluctuated capital market, fee cut, profit concession, our wealth management income was down by 16%, but the decline was gradually changed quarter by quarter and accounted for 46% of the total fee and commission income. Payment and settlement income decreased by 7%, mainly due to sluggish consumption and representing 39% of fee and commission income, an increase of 2.09 percentage points. Third, we continue to consolidate strength in retail finance and achieve coordinated development of the four business segments. We resolutely secured the strategic dominant position of retail finance and placed equal emphasis on the quantity and quality of retail. The number of retail customers exceeded 200 million, an increase of 6.6%, among which Golden Sunflower and above customers, 5.23 million, up by 12%. AUM from retail customers grew to a new level.
AUM from retail customers was approaching RMB 15 trillion, with an annual increment increase of RMB 1.61 trillion, hitting a three-year new high. Among them, AUM from customers in the level of Golden Sunflower and above increased by 12.9%. Retail loans grow steadily. The balance amount to RMB 3.64 trillion, up by 6%, and the increment market share continued to increase. We adhere to the stable and low volatility strategy by steadily developing our credit card business. We have 69 million active credit card users, and the credit card transaction value of the company amounts to RMB 4.42 trillion. Second, customer acquisition of corporate finance continued to increase, and we continue to deepen our characteristic development. The coverage expansion of corporate business received remarkable results, with an exceeding three million number of customers from the retail finance.
The corporate balance of the financing products aggregated to corporate customers exceeded CNY 6 trillion. Among them, traditional financing increased by 12%, and non-traditional financing increased by 11%. We continue to innovate characteristic specialized products. Supply chain finance business grew by 23%, and the core enterprises and upstream and downstream entities we served increased significantly. Users using the Treasury Management Cloud increased by 28%, and the international BOP for corporate clients increased by 19%. We upgrade customer service model and give full play to our special service mechanism, such as one entire bank for one customer, IB, PB integration, etc. Third, the investment banking and financial market continue to strengthen our competitive position. For debt financing instruments with the company as the lead underwriter, we ranked third among the peers.
We also ranked first by the underwriting size of ultra-long perpetual bonds and SiTech innovation notes underwritten, and our M&A financing business volume increased by 6%. In terms of financial market business, the transaction value of RMB bond investments increased by 7% year-on-year. In terms of bill business, the direct bill discounting business increased by 35%, ranking second in the market. In terms of FI business, we have partnered with 107 securities companies in third-party depository service, and the customers we serve increased by 11.2%. Wealth management and asset management business continue to increase. We follow our customers' risk preference and provide a diversified asset allocation service. For customers holding wealth products, reached 58.22 million, increased by 13%. Customers using tree asset allocation service, reaching 10.38 million, increased by 13.84%. The balance of retail WMP increased by 12.38%.
Agency sales of non-money market mutual funds and insurance policies increased by 101.48% and 21.07%. The average daily balance of corporate WMP grew by 30%. The total asset management business amount to CNY 4.48 trillion remained stable. Balance of asset under custody was CNY 28.86 trillion, up by 8.24%, ranking among the top of the industry. Fourth, we accelerated development in key areas and enhanced our level of comprehensiveness and international development. We respond actively to the challenge of low interest rate environment, expand development room, and forge competitive advantages and promote the diversification of income to enhance our sustainable development capabilities. We accelerate our development in key regions and key areas. The growth rates of customer base, AUM, core deposits, and loans of branches in key regions were higher than the average level of domestic branches, continuously making a higher contribution to the bank.
The growth rate of loans in key areas such as SiTech finance, green, inclusive finance, and manufacturing industry was significantly higher than the average growth rate of the loans extended by the company. We built distinctive advantages in retirement finance with the pension funds under custody increased by 26%. Scale and market share steadily increased. A total of 111.3 million individual pension fund accounts have been opened. We accelerate the improvement of our level of international development and promote our overseas institutions to consolidate our capabilities. We focus on key scenarios such as Chinese enterprises going global, foreign enterprises bringing in, and other key scenarios to provide comprehensive services such as global accounts, cash management, etc. Total assets of overseas branches was RMB 236.5 billion, an increase of 10%. Profit before tax RMB 2.6 billion, up by 8%.
The total asset of CMB Wing Lung Bank was RMB 453.05 billion, an increase of 6.19%. We leverage on the advantages of our full licensed operation through our subsidiary, enhancing our comprehensive operation capabilities. CMB International completed 38 Hong Kong IPO projects and ranked first in the market in respect of the share of IPO underwriting in Hong Kong. Scale of WMP under management, CMB wealth management amount to RMB 2.47 trillion, ranking the first. For CMB leasing, it continued to increase its efforts in asset placement. For the scale of asset management business of CMB China Merchants Fund, amount to RMB 1.57 trillion, an increase of 1.29%. Fifth, we continue to strengthen risk management and maintain stable asset quality. Affected by several factors, such as the continuous adjustment of the real estate market, some of the risk indicators increased slightly, but the overall asset quality remained stable.
The MPR ratio of corporate loan was 1.06%, down by 0.13 percentage points. The MPR of retail loan was 0.96%, up by 0.07 percentage points. Special mention loan ratio 1.29%, up by 0.19 percentage points. Overdue loan ratio 1.33%, up by 0.07 percentage points. We strictly classify assets, and MPR formation remained stable, and we closely follow the changes in the external environment and enhance our risk prevention in key areas. The ratio of MPR to loans overdue for more than 60 days was 1.17. MPR formation ratio was 1.05%, up by 0.02 percentage points. Balance of corporate loans granted to the real estate industry was RMB 18.55 billion, 4.062% of the group's total loans, with the MPR ratio being 4.94%, down by 0.32 percentage points.
In terms of corporate loans granted to the manufacturing industry, we strengthen industry research and take other measures to maintain good MPR formation and MPR ratio of the manufacturing industries. In terms of retail loan, we focus on high-quality customers, optimize regional structure, and improve the accuracy of risk identification. Residential mortgage loan and retail microfinance loan, and for credit card loan and for consumer loan, their MPR ratio were 0.48%, 0.79%, 0.175%, and 1.04%, remaining low in the industry. Sixth, we explore AI Plus finance model and accelerate the digital and intelligent transformation. We accelerate the application of AI in customer service, risk control, operation, office, and other areas to comprehensively promote the intelligent transformation of operation and management.
In terms of customer service, we use large model to upgrade our smart wealth management assistant and enhance the self-service capability in high-frequent, complicated scenarios, and we generate a digital PM for hotel finance. In terms of operational management, we launch the intelligent assistant for RM and apply large model in capital management, risk warning, HR management, etc., to enhance our operation efficiency. In terms of internal operation, we use intelligent technology to enhance our business handling efficiency, and over 730 operational processes expanded its application by using the large model, and the efficiency of key business process increased by 58%. We realized the replacement of more than 26 million man-hour by intelligent application and eight million man-hour by conch RPA. The above is the main operating information in 2024. Now, I would like to invite Chairman Miao to introduce the Outlook and Operational Strategy for 2025.
Now, I will briefly introduce the outlook and the business strategy of the company for 2025. Looking forward to 2025, the banking industry faces both opportunities and challenges. In respect of challenges, firstly, the external environment is more complex. Secondly, the China economy still faces many difficulties and challenges. The foundation for economic recovery is not yet solid, with insufficient effective remands, sluggish consumption, and some enterprises are still facing difficulties in production. The banks are facing pressure in its operation. We are facing with narrower NIM, lower fee rates, and insufficient effective credit demand and other challenges, which further promote the involution of the banking industry. In terms of opportunities, China's economy adheres to the principle of making progress amid stability and promotes stability through progress.
We see many policies coordinate with each other to spur vitality, bring new opportunities for the banks, which was reflected in the following aspects. Firstly, macro policies became more proactive and effective. The fiscal policy will continue to ramp up efforts and become more supportive. Monetary policy will be further easing, and there are continuous launching of a bunch of policies, at the same time, we see these policies revitalize the market confidence, stabilize the economy, and improve the operating environment of the banks. Secondly, industrial transformation and upgrading are accelerating, and high standards opening up continue to expand. Technology innovation drives the development of new quality of productive forces, accelerating the construction of a modernized industrial system. There are many and many enterprises going into global operation. They explore into diversified markets. Third, artificial intelligence drives a new wave of technology revolution and industrial transformation.
At present, we are in a critical period of transformation from digital to intelligence. Bank in the future may be divided into intelligent banks and non-intelligent bank. The AI technology's rapid development can lower the cost and threshold of using large model technology, providing strong impetus for the transformation of commercial banks. Looking into 2025, we will stick to the strategic vision of building the best value creation bank with innovation-driven development, leading model, and distinguished features. We will confront challenges, continuously improve our three core capabilities of wealth management, fintech, and risk management, and accelerate to create more and greater value for customers, employees, shareholders, partners, and the society. Firstly, uphold fundamental principles and break new ground, and promote continuous improvement in high-quality development. Secondly, maintain strategic focus and further consolidate and expand core competitive advantages.
Thirdly, adhere to technology leadership and create a new moat for intelligent banks. Fourth is to adhere to distinctive development and accelerate the level of international development. Fifth, adhere to a risk-oriented approach. Thank you. Thank you, President Wang and Chairman Miao. We will now enter into the Q&A session. We will first invite questions from investors and analysts, and then we will have time for the media. Before you raise the question, please state your name and the agency you represent before you raise the question. This lady, please.
Thank you for giving me this opportunity. I'm Mei from UBS. Thank you very much for Chairman and also Mr. Wang's introduction. First, congratulations to the results of 2024. My question is for Mr. Miao that you mentioned a lot about the macro situation, including less ineffective demand and also interest rates coming down.
I would like to know what's your judgment for the macro situation and in this challenging environment, how CMB can maintain your own strength and advantage. Now, CMB actually has now the highest PB among the Chinese banks, over one-time PB. How can you maintain your high level of ROE in the long run? We hope that that could be over 15%. Your valuation and also your valuation are all better than peers. Thank you very much. How can you maintain that in the long run?
Thank you for this question. It's a very big comfort. Yeah, you think that you are quite positive on our results. In this macro situation, actually, we are facing challenges, but definitely there are opportunities.
I think it's mainly, I would like to say, it's uncertainties, especially like in the U.S., the new government saying they want to shore up the tariffs on Chinese imports. Also, there are a lot of uncertainties in the U.S. market, and they are saying in last year, on 26th September, after a series of policies have launched. I think the economy is restoring. I think the uncertainties in China can respond to the uncertainties in the world. Very recently, I think the recent central government also sent out the signal that once there are shocks or bigger shocks coming from the outside external environment, there will be more stimulus policies rolling out. I think this provided certainties in the external environment for banks in China.
The main challenge for Chinese banks is less effective demand, especially from the demographic level, which the aging population leads to a decline of the interest rate. That is why I say it's a cyclical problem for the bank to face the interest rate coming down. It is also a trend that the interest rate will be coming down. At the same time, the lower fee rate is also a challenge for Chinese banks as well. I think that our advantages of CMB among the peers are still very obvious. If you look at the NIM side, we are having one of the highest NIM among the banks. Definitely, our NIM is narrowing down, but the level of magnitude of narrowing is smaller than the other banks. This is the main advantage of CMB.
From the fee-based business, and in terms of wealth management, I think we still have a strong advantage on that. Definitely, in financial markets, we also have advantages and strength, but I think we're even stronger in wealth management. If our NIM can maintain to be one of the highest, and also our strength of wealth management can be one of the best among the peers, then I think definitely CMB can be one of the best banks in China. My hope is also to we really hope that your hope is our hope, namely to maintain a high level of ROE, but it's a very good wish. This cannot be fully guaranteed, namely over 15% for a long run, because this is also determined by external environment.
What I can assure you is that as long as our advantages in NIM and wealth management can be maintained, which means that our ROE can be better than the peers. You see our equity, the size of equity is stable, and as long as our return is better than others, namely our ROE will be better than the peers, our benchmarking peers, and much better than their ROE. I am very confident on that. Are you satisfied with my answer? Next question, please. Thank you. I am Zheng Shengsheng from CICC. I read from the words, the letter from the CEO, namely you were talking about internationalization and building up comprehensive capacities, and I read your annual report. Would you please give us more elaboration on that? Yes, indeed.
In the letter, I said about how we can build up our internationalization and going to a more intelligent building of a more intelligent bank, and also to build up our strength and our comprehensive capacities. I think this is mainly to responding to the external environment, like Mr. Miao just said, like the low interest rate, low fee rate. In this external environment, how a bank can expand the revenue source and maintain a stable revenue is very important. Also at this time, we see opportunities that a lot of Chinese companies are going global and operated in the global market. Banks also need to provide this international service to accompany the companies when they are expanding their business overseas. We are seeing opportunities in terms of AI, namely these also provided opportunities to banks.
CM B started as a bank which emphasized highly on technology. We were the first to launch the mobile banking, to launch the internet banking. Also, in terms of AI, how we can continue to be advanced than our peers in terms of AI technology application and to improve our service capability. This is also very important and how we can respond to the external environment. Fourthly, the environment as we see is that banks are having the same services, namely we are seeing evolution among the banks. In this kind of environment, how we can be differentiated from our banks is also very important and to even foster and consolidate our unique strength. That is why I say the four aspects, namely internationalization and comprehensive operation as well as diversification and to be more intelligent are the very key four important strategies.
As for overseas operation, we have overseas branches and also we have overseas subsidiaries. In terms of our comprehensive capacities, we have different licenses. They are performing quite well in their own unique market, like wealth management, asset management, investment banking, financial markets, credit card, and also financial leasing. These are unique businesses that they can have their own advantage in their own niche market. All this will be combined, will become the very good strength of CMB to provide a whole comprehensive solution to the customer and become the new growing points or growing area for CMB. At the same time, for unique areas, we also want to build up our new strength, like in terms of technology, to be advanced in technology and to be advanced in AI. We have set up the technology fund, and investment is around RMB 3.5 billion every year.
We will continue to invest more into technology and to be more advanced. I think by doing so, this will help us to realize diversification of income resources and help us to go through the interest rate cycles and to build up our own competitiveness and to have stable return to our shareholders. Thank you. Thank you. Next question, please. Good morning. Congratulations for the results that you have said. I really said that during my career. Yesterday, I sent out my report, namely strong and compelling, because I think your results are very persuasive. Yesterday, actually, we have seen your stock price has come down a little bit. Some investors asked me whether your results are not so solid or whether there are some problems that we have not seen. My point is that shares sometimes cannot fully respect the fundamentals of a corporate.
I'm still very confident in CMB. My question is about NIM. I think that this year, China has actually slowed down the pace of interest rate cut down. I think what is your expectation for your NIM trend this year? In your report, saying that this year's plan for loan growth is around 7.8%, whether it's quite an optimistic plan and whether it will be difficult for you to realize that. Thank you. Your first question is about NIM. Last year, our NIM is 1.98%, down by 17 bp s. As we said, the level of the narrowing down is contraction is better than the peers. I would like to share with you some of the trend of last year's four quarters. The first quarter is down by 27 bp s year on year, first quarter. Second quarter, down by 17 bp s year on year.
The third quarter, 14 bp s year on year. The fourth quarter, 10 bp s year on year, decline. If you look at the trend, the magnitude of the decline is also narrowing down quarter by quarter. Why I share this trend with you? I think that this kind of trend might continue. The reasons I think just now, Mr. Wang and Mr. Miao have already given you some hints on that. The main aspect is that there are three LPR cut down and also for adjustment of existing mortgage rate. This impact will continue into 2025. Last year, when we released the interim results, I said that NIM might continue to follow, will slow down to decline. A precondition is that there will be no major external policy changes.
Just a while after what I said is that new policy has been rolled out, namely banks need to adjust the existing mortgage. This year, within the PBOC statement, is that to choose the right time or proper time to cut down the IRR and also to cut down rates. Our expectation for this year is there will continue to be interest rate cut this year, which will pose definitely pressure on the NIM trend this year. At the same time, I think another challenge is more competition among for the assets. Since there are less effective demand and competition for loans and assets, it's also very fierce, which will continue to lead to a decline in asset yield.
Especially at the same time for the assets, which have enjoyed quite a high yield in the past, like credit card, retail loan, now we are also seeing a decline on the yields as well. These are all challenges. These are the challenges. I think there are also opportunities, like the decline in deposit cost. Last year, our deposit cost actually was, as you know, is always one of the lowest among the Chinese banks, but we last year continued decline by 8 bp s. At the beginning of the year, we are also seeing the trend of decline of our deposit cost. I think this is quite beneficial or contributes some positive things to the NIM. For the interbanking funding cost, it is 1.09 for CMB. This year, I think that the cost of the demand deposit from financial institutions will continue to decline.
At the same time, one thing we are seeing is positive marginal positive trends for the trend of the term deposit. Last year, I think our demand deposit ratio has been back to over 50% at the end of last year. I cannot firmly say that it has already been a firm trend that people are trying to choose demand deposits instead of term deposit. I think we still need to observe that. A good sign is last year we are having a good balance of our demand deposit. This year, we are seeing higher growth on demand deposit as well. These are the positive trends that we are seeing for NIM side. In 2025, I think that the trend of the contraction on NIM will continue.
Our goal or our hope is that the level of contraction compared to last year can be improved. We can be ahead of our peers in terms of NIM absolute level. Secondly, responding to your second question about the loan growth, in our annual reports, our budget for loan growth rate in 2025 is around 7.8%. This is our budget. Whether it can be completed will also be decided on external environment and also our own arrangements. For a long time, we think that we hope that the loan growth rate for every year, there are two determinants on that. One is to be in line with external environment, including GDP, like the PBOC's budget for social total financing. Second consideration is that we want to be more stable on loan growth rate through cycles.
We think the excess volatilities is also a risk. That is why the loan growth rate for CMB is quite stable, even to go through the cycles, even though we are facing volatilities in external environment. Last year, loan growth rate is around 5.8%. If you exclude bill discounting, then the pure loan growth is around 8% last year. Compared to years before, I think this growth rate in 2024 is also stable. In 2024, I think that we'll continue to originate effective assets and hopefully that we can maintain a stable loan growth rate. Whether we can realize this goal, definitely we'll work hard on that. Whether we can realize this goal still depends on the external environment. It's highly related to that. Thank you. One thing I want to supplement.
In the domestic market, as the interest rate liberalization continues to evolve, and I think it's very important that the asset decides the liabilities, namely the competitiveness on assets or whether you can originate good assets, this decides the competitiveness of the bank. Around 7% to 8% growth rate, this is also one consideration behind this growth rate determination. As long as we can have a loan growth rate, then this will help us to maintain a sound NIM level. As long as we can maintain a stable loan growth rate, this will help us to originate more customer and to originate more low-cost deposit and also to bring us more valuable business. That is why I think asset origination is very important. This will be determined by capital, by external environment. Yeah, this also will be constrained by capital.
This kind of a balance among business development and also the capital constraint. Thank you. We'll have the next question from the row four. Thank you for this opportunity. I am Claire from GS. As you have also mentioned about the application of AI in the bank, I would like to ask, how would you assess AI application in a bank operation and how will it influence your efficiency enhancing and cost reduction? What measure have you taken and what results have you achieved? I will invite our CIO to answer this question. Ever since our establishment, we continue to adhere to the strategy to empower the bank by technology. In the internet banking and mobile banking era, we seize every opportunity arising from technology revolution and launch many innovative products and services, including our technology system. It is also continuously iterating and upgrading.
For instance, our mobile banking that we serve our retail customer, as you all know, it is widely recognized as the best mobile banking application. Our migration to cloud is a major trend. By the end of 2022, we have completed our fully migration to cloud, which is also the first batch of banks among the Chinese banking industry. President Wang also mentioned the full transformation, no development, among which the intelligent and digital transformation is one of the most important strategies. There are many key points within the transformation. Among the important focuses you have mentioned about our application of AI and what influence will AI bring into our corporation operation, it is hard to give you a very accurate answer, but I would like to answer first on the application of large model.
Of course, the disruptive changes brought by large model could be viewed from two aspects. The first one is technology. LLM, in understanding knowledge in the inference capability, this breakthrough is very disruptive in the history. It is undoubtedly very historical. Will it change our operational model? It still remains to be debated and see. I'm not sure whether you have noticed that the CEO of Microsoft mentioned in an interview in February that he has an idea, he has a hint. If it is a technology that is equal to the level of industrial revolution, we will see a 5% to 10% of GDP growth of all countries. The sign is not that obvious. It is an idea given by the CEO of Microsoft.
Maybe it's an overheatedly discussed topic within the market, so we need to remain cautious and reasonable towards how AI technology will pose influence on our life, on the world we're in, and on the bank's operation. In some small areas, we have already seen some great changes brought by applying AI, but for the bank itself, it is a highly digital scenario, a business model. Large model will undoubtedly give full play to bank's operation. Actually, for CMB, we start very early. In 2017, we have established the first AI lab among our peers. We have got well prepared for entering into the smart era, the intelligent era. We have also reserved many talents, many technologies. As in 2022, when OpenAI released ChatGPT, we attached great importance to our senior management.
In 2023, our Chairman, Chairman Miao, also proposed the statement of intelligent and non-intelligent bank, and they have totally different fate and future development. We have significantly increased our input in developing AI, in developing large model. Secondly, in order to do a good job in large model, we need to construct a full-stack architecture. Our large model architecture was consisting of four tier. At the very bottom of it was the intelligent computing infrastructure, and then middle office of AI. Then the scenario application, we have already developed over 120 scenarios within the bank. This is our full architecture that consists of four tiers. We have quite deep understanding over the application of AI and large model and how it will promote our faster pace of development and bring us more competitiveness in the market.
I can also show you some examples of how AI is applied in our business. For instance, in the retail finance business, we have developed an assistant called AI Xiao Zhao. Many of our employees, regardless of being relationship manager or product manager, have also been benefiting from this assistant in corporate finance business and also the inclusive finance business. The business model is very distinctive. The business tends to be quite short in its period of time in its tenure, and the frequency tends to be high. We use the AI assistant to help the relationship manager to increase the efficiency to approve business cases in inclusive finance. We have also developed the asset and liability assistant within the bank to help increase the 50% of our efficiency in quotation, pricing.
We use the assistant in risk management, capital management, and other areas within the bank. In various scenarios, we have already applied deeply AI and large model technology. In the year 2024, by using large model, we actually generate quite good productivity equaling to over 5,000 manpower, full-time employee. In this regard, we will resolutely remain our input to IT and try to build us into a flagship of AI-driven bank. As you all know, there are some AI delusions. We also attach great importance to it. We will always adhere to a cautious attitude to take multiple measures to exclude the uncertainties brought by technologies to be compliant, to follow the requirements given by our regulator, and bring every aspect of the positive momentum given by AI technology, large model. This is my answer to your question. Thank you.
I will have another question from the lady on site. Thank you, senior management. I am Pu Jiayi from Huatai Securities. I have a question regarding asset quality. To see from your annual report, your corporate asset quality remains good, but retail asset quality fluctuates a bit. Combining your experience from the past economic cycle, what is your outlook towards the asset quality of retail loan? When is the tipping point of the retail loan asset quality? Thank you for your question. Just as you said, for the whole bank, our asset quality remains good. NPL ratio 0.95% and allowance coverage ratio remain high. We still attach great importance to the overall condition of the asset quality. We noticed that the retail loan asset quality is showing some signal of increasing pressure.
Our MPR formation ratio was MPR formation balance was CNY 39.3 billion, mainly from credit card business. Credit card business, we can say that the MPR formation remained high but stable. Consumer finance MPR ratio was 1.04%, but the special mention loan ratio and the overdue loan ratio have also shown increasing tendency. For mortgage, the MPL ratio was 0.48%, but special mention and overdue loan ratio also increased. Generally, the overall retail loan asset remained leading in the industry, but the trend combining with the backdrop of the macro economy actually increased. We have attached great importance to the asset quality of retail loan business. We have optimized the risk management model, and we have optimized our customer selection. Customers from credit card, consumer finance, and microfinance business, we will optimize our customer selection. We will also optimize our region selection.
Which areas tend to be lower risks? We will focus more on these regions and customer base from these regions. In mitigation tools for mortgage, for microfinance loans, we have also shifted our model to have more pledged and collaterals for these types of loans, with the pledged and mortgage rate being 37%. For mortgages, the pledged rate was as high. For microfinance loans, the mortgage rate was as high as over 80%. For different positioning, for different customer base, we have different risk principle. We will act according to different business model and have targeted risk management and control policies. At present, when will we see the tipping point of retail risks? I think that it is still depending on the macro environment, the external environment. As the residents' income continues to decrease, the unemployment rate is still increasing.
These influences will bring pressure to the external environment, along with our macro environment tending to be steady with a positive trend. The unemployment situation will be improved so that as the general backdrop improves, so is our asset quality condition. Even though we are facing a very challenging external environment, CMB will still take retail finance as our mainstay. We will act according to the risk condition and give accurate and appropriate risk pricing for different retail finance business. We have a large proportion of retail finance business larger than the corporate finance business. We believe the retail finance business can also bring us higher yield. We will maintain appropriate and reasonable growth of retail finance business. Thank you. Thank you, President Wang. I will have the next question. Thank you, senior management. I am Lily from JPMorgan.
I have a question regarding the core tier one CAR ratio. Actually, it is very high, much higher than your domestic and even international peers. On the other hand, you have quite large pressure in the decreasing ROE. How is your idea or new plan for increasing the return to shareholders? Thank you for your question. Regarding the high CAR, how do we view the high level of it? Of course, from the statistic level under the advanced measurement approach and weighted approach, our CAR, core tier one CAR, and to see the reason behind why would these indicators all be high. In the first place, we have conducted many works and enhanced our level of capital endogenous capability, which brings us more strong CAR level. On the other hand, it is also influenced, contributed by our new capital regulation.
These two altogether contribute to the high level of CAR. I do not think the high level will continue for quite a period of time. It is not something we can naturally sustain. We hope that we can act under the regulatory requirement and maintain a 2.5% cushion as buffer. On the one hand, as a systematically important bank, there would be capital requirement for us. According to our internal calculation, 2.5% of buffer is quite sufficient for us. Our core tier one CAR should maintain at the bottom line requirement of above 10%. Under the advanced measurement approach, we have already satisfied. Under the weighted approach, we should remain cautious and keep a close eye on whether we have already met the requirement. We will also save some capital to tackle with the future challenges that we may encounter.
This is the first reason that I want to explain and how do we look on our CAR level. I think another reason behind your question is that how do we remain at an appropriate level of ROE and how to maintain a good equity to deliver a good ROE indicator. My answer is that to deliver a balance between the two. From the bottom, we hope that we can deliver good return to our shareholder. According to my analysis to CAR, we cannot say that we are fully comfortable with our CAR to reduce our capital level. For ROE, our idea is to whether we have a target, even though we may not maintain above 15%, but we still aim to outperform our peers. That is our target. Thank you, President Peng. We are having the next question. Thank you.
I am Xu Ran, Richard Xu from MS. Your retail customer base is quite strong. Your deposit and retail AUM continue to be robust. I would like to know what is the future growth point of retail business. You have a very competitive environment, market environment. Where is your competitive edge, your competitive point to support your strength? Now the shrinking loan yield is quite significant. Will it influence your service delivered to your client? We attach great importance to the customer base growth. For the past two years, our retail customer base continued to optimize in its total number and structure. For corporate customers, we think that for CMB to continue to develop, we need to maintain three basic things. One is customer base is very important, namely to be stronger and to be better in terms of customer base.
The size of a customer decides the size of CMB, how well CMB can develop. The quality of customer decides how well CMB can develop. This is also in line with our core philosophy, namely customer-centered and create value for customer and to serve better our customer. This is very important. One of the bases that we need to consolidate. In terms of the quality of our customer growth, we emphasize on the newly graduates, namely young people, how we can originate customers from young people. Every year, there are over 10 million graduates from universities. If we can originate those customers, namely new grads from universities, this can be a very main source and very good source for CMB's customer growth in the long run and also can be sustainable growth.
Secondly, we emphasize namely the parenthood, parents and children customers, because parents are now investing a lot into education of their child. That is why I think we need to nurture their kids from their parents to have accounts with us. When they grow up, they can also become our customer. This is our long-term scheme. Thirdly, it is customers who have cross-border financial demands, like students studying overseas. Also, some residents have demands for global asset allocation. How we can meet up this kind of globalization of asset allocation demands is very important. Fourthly, I think retirement services are also very important because the aging population is aging in a more accelerated way. For people who were born in the 1960s and 1970s, they have already accumulated a lot of wealth.
How can we help them to manage their assets? Yeah. This is very important to inherit it to their children. Very important. Last year, I think we have over 10 million accounts, pension accounts opened by our customer. These all provided us opportunities and potential for our customer growth. These are all in line with the new trends in the market. We need to follow the trend so as to maintain or sustain the customer growth. We have family trust business, family wealth inheritance. These are also potential areas for growth. Customer base is one of the very important things that we need to consolidate and to satisfy the customer's needs in different aspects. With these customer base continuing to enlarge, I think the strength of retail can be sustained.
In terms of the corporate side, I think there are over 60 million corporate clients registered in the market. Our market share is still quite small. It is around two million, three million. We are seeing new registration of new corporates are growing. That is why the customers that we newly originated are customers who are newly registered in the market. These newly opened companies and newly registered companies mean new opportunities. This is also new opportunities for sustainable growth of the bank. When we accompany the company to grow, which also helps us to develop as well. In the past, we already provided services to many companies in the new industries. Now they are already kind of the major players in the market.
Now we are servicing different kinds of customers and incorporate size and to enlarge the customer size, especially for customers who are in the special and new industries. Therefore, I think these will help us to maintain a sustainable growth. We will continue to consolidate our customer base. Thank you. Next question, please. Thank you. I'm Gary from HSBC. I think the fee-based income is a very good highlight for CMB. Last two years, we are facing difficulties on that. Looking ahead, whether it will, from the fee-based income, whether it will become a drag to become a highlight again. Second question is about deposit growth, whether you are seeing the trend of term deposit, whether deposits are going to wealth-related products. Thank you for your question. The first question about fee-based income.
From the trend of the fee-based income, I think banks are all under pressure, especially from last year as we're seeing a lot of policies for fee cuts for banks. Banks are all facing difficulties in fee-based income. For especially like the insurance-related products, it was also under pressure for the last two years. We are also analyzing the trend as from quarter-on-quarter basis from last year. I think that we can elaborate on fee-based income and also other non-interest income. They might are facing different situations. If you look at the fee-based income, last year we have negative growth. On a quarter-on-quarter basis, the magnitude of negative growth was narrowing down. The first quarter was down by 19%. At the end of the year, it is much smaller than that number.
This is mainly, I think, the drag on last year's fee-based income was the fee-based income coming from extensive wealth management business. The other thing I would like to say is the net non-interest income. Last year, we benefited from the rate card, from the market rate card. Especially we have many gains on the bond investments. Like for the whole year, the growth of non-interest income is over 33%, which is contributing to the positive growth of the total non-interest income. This year, I think things might turn around compared to last year. The first one is the changes on fee-based income. This year, I'm confident on the stabilization of fee-based income this year. I'm more optimistic on that because from last year's September, a lot of policies have been launched. The capital market, confidence in the capital market has been restored.
Activities in the capital market have become more active from last year. As we see in the last quarter, we see a growth of AUM in fourth quarter last year. Quarter-on-basis is we have seen it has even been doubled growth quarter-on-quarter basis, which is quite a good base for this year's performance. If the capital market trend continues the trend of positive and active, I am more confident on the fee-based income to be stabilized this year. This is my judgment. Secondly, for the other net non-interest income, it is highly related to our judgment to the trend on the interest rate. Last year, we have seen the 10-year Treasury bond yield declined by 88 bp s. This year, we have seen adjustment in the bond market.
This definitely has posed negative impact on the valuation of the bond investments. But our judgment is that in this quite accommodative monetary policy environment and the long-term interest rate decline cycle, I think that the trend of the bond rate coming down or in a more volatile manner is kind of a long-term trend. In the long run, we think that after the first quarter, the volatilities might come down. I think last year's 10-year bond was 10-year Treasury bond, 1.78 bps . Compared to last year's 1.68, it's only 10 bp s up. Pressure on other non-interest income in the first quarter might be bigger. If we look in the longer term, it might continue to stabilize. Secondly, about your deposit just now, I also mentioned about the trend of term deposit.
Actually, for these past years, we are seeing that higher trend of term deposit, higher proportion of term deposit. It has continued for the past years. After 24th September, we have seen some changes on the proportion of demand deposit. As I just said, at the end of September, the demand deposit proportion is 48%. By the end of the year, it's 52%. There is quite an obvious rebound. Into 2025, we are seeing less growth on the demand deposit. On a daily average basis, our demand deposit is better than on a year-on-year basis. On the in-time basis, on a time basis, we are seeing more term deposit. We cannot draw a conclusion from that whether there is already a turning point for a term deposit trend. Marginally, there are some positive changes.
If the capital market continues to be active and the trend is positive and there is more consumption confidence, then we are more confident on the trend to have more demand deposit. Now it is too early to draw the conclusion that the trend of term deposit is over. Thank you for giving me this question. I am Ms. Ma Xiangyun from Changjiang Securities. I have two questions. One is for Mr. Miao. Namely, my question is about market valuation management. Just now, you said that CMB has the highest PB ratio in the market. Recently, you have also released your market valuation procedures. I would like to share your views on what is your kind of concrete procedures for this kind of market valuation management. Secondly, it is about provision level.
What is your target for the provisioning level and why are there declines in the provisioning indicators? Thank you very much. Okay. I will answer the question for market valuation. Just now, you said that CMB have one of the highest PB among the banks. Namely, we are the more expensive bank. I think it is worthwhile. The price is worthwhile because our value is one of the highest among banks. How can we do a better market valuation? I think this is a question facing all public companies and all the senior management is one of the key things that we need to consider. I think the key is to operate well and then have good return. This is a basis for market valuation. As long as you have a good return, then you can do a good market valuation management.
If you do not have a good return, it's impossible to have market valuation management. Under this external environment, firstly, I think top priority is to increase the return, increase the return or capability for risk management, and second, capability for risk management. Thirdly, capability for innovation. These are three major important capabilities and also to create value for our shareholders, to society, to the counterparties. Market valuation means to create value for our customers as long as we can improve our capability to generate more revenue and for better control of risk and to be more innovative, which means we can generate more value for our customer and to have a better moat for long-term growth, which means that we can create value for our customer. This will be the solid foundation for good performance for market valuation management.
Based on that, I think important is to maintain a stable dividend payout ratio. Just now, Mr. Peng said about dividend payout ratio. Some investors expect that we will have an even higher dividend payout ratio. Some investors saying that the dividend payout ratio is in line with their expectation. In 2013, we have written down in our articles of memorandum that our dividend payout ratio will not be less than 30%. It is the first bank in China to do so. This year, our dividend payout ratio is already over 35%. For dividend for every share is CNY 2. I know that some investors are expecting more, expecting higher. I think that to keep that dividend payout ratio at a more high and also at the same time stable level is more important for investors.
If we increase the dividend payout ratio this year, but then decrease that next year, I think this is not good for value creation. This is also not good for the valuation stable. We want to be ahead of peers in term, but also at the same time stable dividend payout ratio among our peers. I think this is one thing, a very important aspect for market valuation. Thirdly, I think in the long run is sustainable growth. To have a good communication with the market, to have a good communication with the shareholders. As long as we can create value, we also need to spread out that to the market and also to let the investors understand that.
To understand what we are doing now, like just now your question about fee-based income, like the net interest income, how were you doing last year and how will you do next year. I think this is also to share more information for you and also to help you to understand more about CMB's future. You will be more confident in CMB. This will also help us to do a better job in terms of market valuation. This time you need to, it's not only storytelling about market valuation. Market valuation, the essence is to do your own business well and to improve your capability to generate more profit and improve your capability for risk management, improve your capability for intelligent. By doing so, I think that we definitely will have a good market value management, even though we are more expensive.
I think it's still worthwhile. Thank you. I will answer your second question for the asset quality management. For asset quality, we are prudent and stable on that. For asset classification, we are very strict. Just now, as I introduced, our MPL compared to loans overdue is already over 1.3, around 1.3 times of the loans that are overdue 60 days. For loans, we also have made prudent and ample provision on that to ensure that we do not have any drag on our development. This is the principle that we always adhere to for the years. For property market and the retail loans that we are seeing higher risks, we are also adjusting our provisioning model to improve the provisioning for these kinds of loans.
Last year, we have increased the provisioning. Total last year is around CNY 40 billion and less than CNY 1.3 billion compared to the year before because overall provisioning level is around CNY 270 billion. Because last year we have disposed a lot of bad MPLs. That is why I have exhausted some of the provisioning balance. As you can see, our coverage ratio was down by 25 bp s. This is mainly because we are seeing a higher amount of MPL amount, which is up by CNY 4 billion, around CNY 65 billion MPL. This is mainly because the denominator is bigger, namely, MPL balance is bigger. That is why we're seeing lower coverage ratio, which means that in good times, we are having a very good profitability. During that period, we improve our capability for more, have more buffer provisioning level.
In the current circumstances, we can also say that made us and help us to have enough buffer to digest the risk in the current circumstances. At the same time, to ensure a stability of your revenue and at the same time, also to have a buffer on the risk. As for the forecast or the trend of that, we think that we need to ensure that there will be enough risk buffer in place to cover risk. We do not want to leave any drag for the future or hidden risk for the future. Secondly, we want to provide for backed loans and also for the loans that we need to provide more to ensure that there will be enough cover on that. I think that the coverage ratio will be more stable level and also more higher level compared to the peers. Yeah. Thank you.
Thank you, Chairman Miao and President Wang. In order to ensure the rights of our individual investors, we have collected some questions through our email. As many of the questions that our individual investors are interested in overlap with what have been already raised, we have selected one that has not been asked. We will invite our staff to read out the question. The question is, recently, the NAFR announced the AIC pilot program to expand, and CMB is largely likely to be included in this program. I would like to learn from CMB whether CMB will experience any changes in your profit-making model and what changes will it bring to your business model, and is it enough capital for CMB to support the establishment of AIC. I will take this question.
In this two session, the NAFR leadership has announced the decision to expand the pilot program of the AIC. This is the first time to announce the expansion of the pilot program ever since the year 2017 when the 5 SOE bank was allowed to establish AIC. It is very important for the banks to support more financing in the capital market. It is very important and significant and meaningful for the commercial banks to enhance their level of comprehensive services in the regard of providing direct financing and also investment and loan business integration capability. We are now under the process of discussion whether we're able to realize our goal, to see our capital strengths. And we have the foundation, the service capability foundation to establish such AIC. Just now, you mentioned that the CMBI has already accumulated very rich experience in this regard.
For us, in our services, despite loan that we are able to grant to our customer, we are also looking to discover more areas such as providing equity financing services to our client. It is very important and meaningful for us to find these new solutions to serve our clients. We are now under the review of the board. If there are necessary announcements that we are required to make, we will act accordingly. Thank you. We are now having questions from the online participants. Please follow the instruction given by the operator. Please press the more button if you are joining from mobile end. Please press the participant button if you are joining from the PC end. Please remember to open your microphone and state your name and the name and the agency you represent before you raise the question.
Now, we have the question from CITIC Securities, Zhao Feifei. Thank you for giving me this opportunity. I have a question regarding that senior management. What is your outlook towards the mutual fund market, the capital market? What is your management strategy and your decision towards the investment accounts? Thank you for your question about the capital market. What is our outlook towards its trend? I have just now mentioned my view as I answered the question regarding non-interest income. For me, I think that after the end of 2024, there are some rebounds in the capital market. Generally speaking, I think it will be a volatile market for the year 2024 with a declining trend. Why is this the case? Because the monetary policy is still quite loosened tune as the backdrop. The PBOC leadership have also emphasized once again previously to lower the market interest rate.
I think that can represent the major trend of the interest rate environment. In the following, what will be the momentum of the economic growth will actually determine the pace of our policy introduced. It will also continuously influence the results on the bank's operating pace. For CMB, I think there are still opportunities for us to allocate resources to our investment accounts. You see in the past year, we have enlarged the proportion of resources in the investment accounts. We have enjoyed the benefit brought by the bond bull market. We will act according to our asset allocation arrangement, including what we have mentioned about the loan growth pace. Of course, for the three types of accounts, we will also give full play of our professionalism in the financial market. We will appropriately arrange to increase the volume of our trading account.
We believe that as the market tends to be more volatile, there will be more opportunity arising from this market volatility. From last year's performance, this has already proved that we have strong professionalism. Therefore, we have quite a successful layout and appropriate timing season. I think we think that it will still be a good arrangement and a good bonus we can seize this year. It is a very good chance for us to prove that we have the capability to select the right timing, to select the right market, to conduct relevant allocation of our assets, and to maintain stable in our overall condition. I will have the last question from our investors and analysts. We will enter into the Q&A session for our friends from the media. We are now having the question from Ma Kunpeng from China Securities.
Thank you for giving me this opportunity. I am Ma Kunpeng from China Securities. I have a question regarding CAR. Just now, Mr. Peng has also made a clear exploration on the denominator. I would like to ask more about the denominator. As we see that your quarter one capital CAR ratio continued to increase and under the risk-weighted approach that your RWA growth rate tends to slow down. If you consider the extreme condition, even though the ROE declined to less than 10%, your RWA maintained at a 5% level, your quarter one CAR will not decrease sharply. From this consideration, has there been any chances for CMB? Is there any chances that you remain RWA growth at a relatively low level? What is your strategy and measure for the RWA growth under the advanced measurement approach? This is my question. Thank you. Thank you.
I will answer the question about the denominator. For me, whether we can maintain endogenous growth of capital, I believe the key is to generate higher return from our RWA. That is RORWA maintained at a high level so that we can have higher level of capital endogenous growth. Besides doing a good job in the denominator, we need to do another also good job in the denominator. We see quite sharp decrease in the growth of RWA. It is mainly because of several reasons. One of the reasons behind is about the new capital rule. The changes brought by the new capital rule reflected in our bankbook so that our RWA growth tends to be slower than the previous period of time. In the real case, the general development of RWA tends to be quite stable.
To see from the year 2024 in the future, we think that the RWA growth 5% is not quite an appropriate and comfortable growth rate. We need to maintain a stable growth. This is also a requirement posed by our board. It is not the case that required by the board to be lower, the better. I have always mentioned that the volatility in the risk is also risk itself. We need to have the ability to sell through the cycle and take into consideration several factors. The first is influence over CAR. The second influence is our risk control. We need to maintain our risk preference. The third aspect is our influence brought by the profitability. Low RWA growth, I do not think it can bring us good growth of profitability.
We need to strike a balance among these three factors to maintain good and appropriate growth of RWA. This is my general consideration in the future operation. We will continue to take good consideration and maintain stable growth of RWA. Now, media from now, we take questions from media. I'm from 21st Century. My question is for Mr. Miao, what is your thinking about financial technology? What is your emphasis on AI Plus finance? How are you deploying that in China back then? Last year, we noticed that you were mentioning was that digital CMB. This year has become digital and intelligent CMB. My question is for Mr. Zhou, what is your positioning of your subsidiary, technology subsidiary, and also your technology department? There are rumors that your subsidiary is going into. Thank you. Actually, we have three layers of technology.
There are three committees. One is the digital committee. One is the information security committee. Also, we have a digital committee. Among this, the digital finance is the highest decision organization to approve the major strategies, major projects, and resources allocation. The information security committee and also technology committee are mainly focusing on internet security and also data security. There are two main departments for technology. One is technology department. One is the digital finance development office. This is mainly for strategies and to design the overall plan for how we promote the development of the digital finance in CMB and also manage the fintech fund as well. For technology department, it is a pure technology department. It is mainly for the IT system construction and operation. This is a kind of a main architecture about the technology CMB.
Secondly, as for the two subsidiaries you mentioned about technology, these are all under the direct management of CMB, of our technology department. Our subsidiary is more, one is more servicing only CMB, one is helping our corporate customers. This is the governance structure of our system, technology system. Just now you mentioned about DeepSeek. Yeah, definitely, it's very hot in the market that the model which launched by DeepSeek is kind of a very big breakthrough in the market for Chinese models, has actually helped the Chinese models to narrow down the gap between Chinese models to U.S. models from nine months to three months. Also, the training, we have innovation on the training of model and also innovation on application. These are very important contributions from DeepSeek. One thing special to mention is that this definitely, DeepSeek has provided more value.
It doesn't only help China but also help countries around the world, including the U.S. From this aspect, I think that DeepSeek's model launched by that is very unique and special and has special valuation. CMB highly emphasizes on that. After two new models launched by DeepSeek, we have already deployed these models and constructed the post-training capabilities surrounding these two models servicing the financial scenarios of CMB. We have already fine-tuned the DeepSeek's model to adjust to CMB's scenario. It's not long of DeepSeek launched these models. It's very strong. Definitely, everyone knows that. You might already notice that illusion about the from DeepSeek R1 model. In terms of the application, since the financial industry is highly regulated and servicing a large amount of customers, we are very prudent in terms of the application of DeepSeek. One thing I want to supplement.
For CMB, highly emphasizes on technology, namely technology makes CMB stronger. From the very beginning, we started from Shiqou. The first building that we have is the technology building. Even though before we have the official office building, we already have a technology building. In the time for internet booming, we are the first to offer the first internet banking, namely from turning us from the bank board to internet banking. In the mobile time, we have the internet banking. We have the online servicing. Also we have the mobile banking. We have the app. We are all advanced of our peers. In terms of the AI, how we can build up our new capabilities, namely to servicing our customer by using our Xiaozhou assistant and by servicing our internal clients, namely our staffs, we have CMB assistant for our internal staffs.
Just now, your question regarding the two subsidiaries belonging to CMB for technology. As Mr. Zhou said, we have the highest decision organization, namely the committee is from a very high-level basis. This shows our emphasis on technology and also shows our application of technology. By this kind of new structure, we help the technology to be embedded into businesses. Actually, we also have six research centers for technology. All these six research centers are helping, targeting at different business segments and also internal operation so that embed the technology to business level and to improve the efficiency and more better alignment between technology and business. The impact and effect is also very good and sound. Thank you. Thank you very much. I'm Mr. Machamang from Security Times. My question is about internationalization, as you said. We will have six overseas branches and three subsidiaries.
What is your plan for overseas presence and how can you utilize or leverage on the resources that you have to have a more better development in terms of internationalization and to go through the cycles? Thank you for your question. Just now, I mentioned that one of the important steps that we'd like to take is internationalization. Just now, you said we have six overseas branches and three subsidiaries. For overseas presence, we follow the areas that we follow our companies which are going abroad and focusing on the key areas where Chinese companies go abroad. Also at the same time, we need to have support from our regulators as well as support from regulators in the targeting market, overseas market as well.
Because financial industry is a highly regulated industry, and it needs to have a very good communication with a regulator from both China and also overseas market. Under this highly regulated environment, how we can better exert or better use our overseas global presence to become more internationalized in the following aspects. The first one, I think Hong Kong is very important market for us. It's very pivotal because this is the first step when Chinese companies or citizens going abroad. Here we have Wing Lung Bank, we have CMB International, and I think it's the main market that we focus on.
No matter if it is from the board or from the senior management, we are highly emphasizing our business in the Hong Kong market to improve our competitiveness here and also to contribute our share to build Hong Kong's core area as the global financial center and also contribute to CMB as well. Secondly, we have a branch in Singapore, which is targeting the whole Southeast Asia. We hope that our Singapore branch can improve its own capability and better serve the corporates and also retail customers' demand. For other overseas branches, I think it is more necessary to follow the regulation in their own market and comply with local regulators, compliance first, and have their unique competitiveness to ensure that there will be no risk and have better development. These are the positioning for these kinds of overseas branches.
One thing I want to mention is that we also have an offshore license, namely servicing. Even though we are in China, we can provide services in the overseas market by using this offshore banking license. Thirdly, I think it is important we can have a better and closer relationship with international financial institutions to work with them to provide services to the corporates as well. By doing so, this also helps us to build up our global service network and capability. By better developing our global presence, this also helps us to improve our management level, namely to be a more international one, to be more linked up to the global bank. Thank you.
I am Peggy from Nikkei for question regarding CMB for your Hong Kong IPO share that you have quite a large proportion, including you act as the lead underwriter and other aspects. Previously, we see some of the other peers are performing better than you, but now you are having a good performance than your peers. I would like to understand the reason behind what kind of effort have you made and what other efforts will you emphasize, such as being the lead underwriter or more projects. My second question is that your global presence, whether it will be influenced by geopolitical issues, and you have also mentioned some of the scenarios about Chinese enterprises going global, will that also be influenced by your decisions to conduct international development? Thank you. Thank you for your question. I suggest second question be taken by President Wang.
About the CMBI's IPO, for recent years, we are actually having a larger share, increasing share of the IPO business in the Hong Kong market and having a high market rank. You also mentioned that we have done a good job this year. The main reason behind are from the two perspectives. One is that we are having stronger and stronger capacity. CMBI are now strengthening its investment banking team. We are accumulating our experience, and the quantity will ultimately be proved by the changes in our quality. Secondly is the coordinated development within the CMB group. Within the CMB itself, we always emphasize on promoting the coordinated and synergetic development among different entities within our system. For clients that is going to be listed in the Hong Kong market under this backdrop, CMBI closely cooperates with our domestic branches.
I believe it is the second factor that contributes to our good performance. We have also improved our mechanism, our process that further enhance the efforts of our coordination. It is also owing to more and more opportunities arising from companies that are going global. For the second question, I think Chairman Miao will take it. For the second question itself, it actually reflects our core competitiveness for CMB, the integration of investment banking and commercial banking business. We are doing a good job in commercial banking, but we are also good at investment banking business, both domestic and overseas markets. CMBI in IB business, we are doing a good job in IB IPO, ranking the first in the market. For the first quarter, we still maintain this good momentum.
For the past quarter, the Hong Kong stock market is delivering satisfying performance, and there are larger deals and more projects of IPO. The capital market is quite active. The Hong Kong International Financial Market still ranked the third in the global financial markets. Unlike some people said that the position is not stable enough, it's fallen behind. We are still quite confident that the Hong Kong market is still the hub, the important financial market around the globe. For the position itself, we are quite confident. The IPO issuance is also leading among the globe in Hong Kong market. We have a strong participation in it. We are very proud of it. We could say that we cannot avoid the influence brought by the geopolitical issue. It is not reflecting, it is not influencing financial industry itself.
I'm not just a chairman of the CMB, but also CMG. In CMG, we have strong prods. We have maritime transportation. These sectors are also under strong influence of a geopolitical issue. For this industry itself, the first thing we need to take into consideration is exactly geopolitical situation. For us, the strategy itself, we are actually aiming to strengthen our existing overseas branches, and we will have active communication with our regulators and take full consideration of risk issues and to cautiously promote the increment business in our overseas business development. Just like what we have been seeing in the Japan banking industry for the 1990s, it's quite a different case from then, from the Japanese banking industry by then. We will take very cautious consideration of global presence, of global business operation, and maintain our own momentum of development.
Due to our time restriction, we will have the last question. Please have a quite brief and limited question. Thank you for giving me this opportunity. The last question. I am Thailand press journalist. I have a question for Mr. Wang Liang. I read from your statement in the annual report that we should improve our own capability to make it certain and to cope with the uncertainties arising from the external environment. How will you cultivate and nurture your own capability? Thank you. Indeed, we see many uncertainties in the external environment. We need to stay firm and walk long. We need to cultivate our own certainty to cope with the uncertainties arising from the external environment. This is a demand coming from our group, a demand coming from our chairman. Firstly, we need to stick to our own strategy and maintain our strategic determination.
We need to adhere to our strategic determination of building a value creation bank. This is our strategic objective. We need to develop to create value for shareholders. In developing our business, we need to hold a long-term philosophy. We need to give full play of our strengths, of our retail finance systematic strengths, and dig deeper into the opportunities and potential of retail finance business in the market and to achieve a dynamic and balanced development of the four business segments. China is a market with large potential. We believe these four business segments are connected and dynamically interacting with each other, and they will promote each other as we conduct development of the four of them. This is strategically we need to remain our determination. The second certainty is to enhance our three capabilities is to enhance our wealth management capability that determines how high we can reach.
The second is risk management capability. As we face a large number of uncertainties, we need to enhance this capability that determines how far we can walk. The third is to enhance our fintech capability that determines how fast we can go. We continue to increase our capability to meet these three targets to build our certainties from the perspective. The third perspective is that to build our own certainty is to nurture an excellent team of our talents, to let our team be graceful to our clients and let our clients be recognizing China Merchants Bank, and to cultivate a strong sense of recognition and belonging within our group, and let our staff recognize CMB, recognize CMB culture. This will be our greatest moat of our certainties to face uncertainties in the external environment.
No matter how the external environment changes, as we maintain good performance in our capability to guarantee we stick to our strategy, we can sail through the cycle and maintain good performance of all businesses and deliver long-term value to our shareholders. Due to time limit, CMB 2024 result announcement will conclude. For more questions, please contact our team or refer to our annual report that is already released on our website. Thank you again. Goodbye.