Dear investors, analysts, good morning. CMB's 2025 interim results announcement will now begin. I am Xiao Yuanf ang, General Manager of the Office of the Board of Directors. CMB has announced its 2025 interim results last Friday evening. Today's event is being conducted in the form of a live online webcast. I would like to now introduce the on-site participants who are with us today. They are Mr. Wang Liang, President and CEO, Ms. Wang Ying, Executive Vice President, Mr. Peng Jiawen, Executive Vice President, CFO and Secretary of the Board of Directors, Mr. Lei Caihua, Executive Vice President, Mr. Zhou Tianhong, Chief Information Officer. We also have independent directors, Mr. Li Menggang, Mr. Liu Qiao, Mr. Tian Hongqi , Mr. Li Chaoxian, Mr. Shi Yongdong, and Ms. Li Jian to join us online.
On behalf of China Merchants Bank, I would like to extend a warm welcome to your participation and thank you for your long support, interest, and investment in CMB. Today's meeting involves two sessions. One, Mr. Wang Liang will introduce the bank's interim results. It takes around 25 minutes. The second session is the Q&A session. It takes around 19 minutes. The meeting will be provided with simultaneous interpretation from Chinese to English. Now, I will give the floor to Mr. Wang Liang on the bank's 2025 interim results. Dear investors and analysts, good morning. Welcome to CMB's 2025 interim results presentation. Today, I will introduce three key areas. First, 2025 interim performance overview. Second, detailed operational information. And finally, a brief introduction of our business strategies for the second half of the year.
For the first half of the year, the group continued our value creation bank strategy adhering to the concept of dynamically balanced development of quality, profitability, and scale, and maintained operational indicators under steady progress with good momentum. This was primarily reflected in the following four aspects. First, we achieved steady progress, completing profitability in the industry. Despite challenges such as narrowing interest rates, interest spreads, and intensified competition, we responded proactively and ensured core profitability indicators showing steady and positive trends. Net operating income: RMB 169.9 billion, a year-on-year decrease of 1.73%. Net profit attributable to the bank's shareholder was RMB 74.9 billion, a year-on-year increase of 0.25%. ROAA and ROAE were 1.21% and 13.85% respectively, remaining at industry leading level. NIM, net interest income, was RMB 106.08 billion, a year-on-year increase of 1.57%.
Affected by declining market asset yield, ongoing shift toward term deposit, and other factors, the NIM was 1.88%, decreased by 12 basis points year-on-year. Non-interest income was RMB 63.8 billion, a year-on-year decrease of 6.77%, with a narrow rate of decline. Net fee and commission income reached RMB 37.6 billion, a year-on-year decrease of 1.89%. Notably, wealth management fee and commission income reversed the downward trend since 2022, up by 11.89% year-on-year. Affected by the changes of market interest rate, other net non-interest income was RMB 26.2 billion, a year-on-year decrease of 12.97%. We enhanced management on cost and expense, with cost-to-income ratio remaining stable at 30.11%. Second, we realized appropriate asset growth with significant decrease in funding cost. We respond actively to the challenge brought by insufficient credit demand, took various measures to maintain stable asset growth, and optimized the structure of asset allocation.
Total asset amounted to RMB 12.66 trillion, an increase of 4.16%. We continue to foster steady loan growth. Total loans and advances amounted to RMB 7.12 trillion, up by 3.31%, accounting for 56.23% of total. Among them, general loans were 6.77 trillion yuan, up by 3.99%. In response to the trend of interest rate changes, we made rational allocation of investment assets. Total investment securities and other financial assets grew by 7.22% compared with the end of the previous year, accounting for 31.39% of total assets, an increase of a 0.89 percentage point from the end of the previous year. We continue to grow core deposits and further reduce liability cost. Total liabilities amounted to RMB 11.36 trillion, an increase of 4.05%. Among them, total deposits from customers were RMB 9.42 trillion, an increase of 3.58%.
Average daily balance of core deposits was CNY 7.61 trillion, increased by 7.77%, and accounted for 87.36% of the balance of deposits from customers. Demand deposits accounted for 49.72% of total deposits, a decrease of 0.62 percentage points. Annualized average cost rate of interest-bearing liabilities was 1.35%, a year-on-year decrease of 37 basis points. Among them, average cost rate of customer deposits was 1.26%, a year-on-year decrease of 34 basis points, maintaining advantages in low funding cost. Third, we sustained sound revenue mix and leading capital strength. We continue to optimize business and revenue structure with a stable value contribution from retail business and steady share of non-interest income. Retail loans accounted for 51.68% of the group's total loans, a decrease of 1.23 percentage points. Net operating income from retail business accounted for 56.6% of the total, representing a year-on-year increase of 1.12 percentage points.
Pre-tax profit from retail business accounted for 58%, a year-on-year increase of 1.42 percentage points. Net non-interest income accounted for 37.57% of total net operating income. Influenced by the annual cash dividend distribution, the capital adequacy ratio experienced a slight decline. Among them, CET1 CAR, Tier 1 CAR, and the CAR under the advanced measurement approach were 14, 17.07, and 18.56% respectively, decreased by 0.86, 0.41, and 0.49 percentage points as compared with the end of the previous year. The CET1 CAR, Tier 1 CAR, and the CAR under the weighted approach were 11.92, 14.53, and 15.61% respectively, decreased by 0.51, 1.01, and 0.12 percentage points. Fourth, we maintained stable asset quality and strong risk compensation capability. NPL balance was CNY 66.3 billion, an increase of CNY 760 million. NPL ratio was 0.93%, a decrease of 0.02 percentage points.
Annualized credit cost ratio was 0.67%, a year-on-year decrease of 0.1 percentage points. Allowance coverage ratio was 410.93%, a decrease of 1.05 percentage points. The loan loss reserve ratio was 3.83%, a slight decrease of 0.09 percentage points, both remaining a leading position in the industry. The ratio of NPL to loans overdue for more than 60 days was 1.12. Annualized NPL formation ratio was 0.98%, a year-on-year decrease of 0.04 percentage points. The above provides a brief overview of our performance in the first half of 2025. We will now turn to the company's operational information. The first half of the year, the bank actively responded to the challenges of the low interest rate environment. We continued to optimize our business structure, consolidate our competitive edges, and forge new growth drivers, mainly reflected in the following five areas. First, we deepened client relationships and expanded client base.
Our retail customers totaled 216 million, an increase of 2.86%. Among them, the number of Golden Sunflower level and above customers totaled 5.63 million, an increase of 7.57%. The number of customers holding our WMP reached 61.07 million, an increase of 4.9%. The number of active credit card users totaled 69.63 million, an increase of 0.28%. Corporate customers totaled 3.36 million, representing an increase of 6.36%. Among them, the number of newly acquired was 305.1 thousand, and sci-tech enterprise customers reached 169.7 thousand, an increase of 4.43%. Corporate customers for withholding transactions reached 1.33 million, a year-on-year increase of 12.12%. Second, we forged distinctive business features and achieved differentiated competitive edges. First of all, the retail finance sector focused on customer needs for deposit loans and payments, continued to enrich product supply, and deepen customer management, further consolidating the systematic advantages of the retail business.
Retail AUM scale exceeded CNY 16 trillion, representing an increase of 7.39%. The increment for the first half of 2025 reached CNY 1.1 trillion, hitting a record high. Retail customer deposit balance was CNY 4.25 trillion, an increase of 5.43%, accounting for 45.13% of total deposits from customers, an increase of 0.79 percentage points. In the context of weak credit demand from the residents, we took multiple measures to drive the growth of retail loans. Retail loan balance was CNY 3.68 trillion, an increase of 0.92%. We adhered to the stable and low volatile operational strategy in credit card business. The credit card transaction value reached CNY 2.02 trillion, down by 0.854% year-on-year, maintaining a leading position in the industry. Secondly, the corporate finance sector focused on key areas and continued to build distinctive financial advantages.
The balance of the FPA to corporate customers was RMB 6.45 trillion, an increase of RMB 395 billion over the beginning of the year. In line with the direction of the country's industrial transformation and upgrading, we adjusted the structure of asset business to support the high-quality development of the real economy. The growth rates of loans in key areas such as technology, green industry, and manufacturing were significantly higher than the average growth rate of the company's loans. We vigorously promoted the characteristic and professional development of pension finance. The cumulative number of individual pension accounts opened by the bank exceeded 13 million, with a deposit balance ranking among the top in the market. Pension funds under custody amounted to RMB 1.41 trillion. We continued to upgrade the distinctive brand of intelligent and digital corporate finance.
The number of customers using Treasury Management Cloud service reached 709.2 thousand, an increase of 15%. Domestic trade finance business volume was RMB 792.6 billion, a year-on-year increase of 20.64%. Thirdly, investment banking and financial market sector continued to build its strength in segmented areas, and its business competitiveness grew steadily. In terms of investment banking business, debt financing instruments with the bank as the lead underwriter amounted to RMB 274.29 billion, maintaining market number one position in the underwriting scale of perpetual bonds and Sci-tech innovation bonds. M&A financing business represented a year-on-year increase of 27%, with several major projects with market influence successfully executed. In terms of financial market business, the number of wholesale customers involved in client flow trading was 66.5 thousand, a year-on-year increase of 14%. The transaction volume of client flow trading of wholesale customers amounted to $159.1 billion, a year-on-year increase of 25%.
In terms of bill business, we deepened the transformation to provide comprehensive services to bill customers. Direct bill discounting business volume was RMB 1.39 trillion, a year-on-year increase of 4.86%, ranking second in the market. In terms of FI business, we expanded the source of low-cost liabilities. The average daily balance of FI demand deposits was RMB 753 billion, accounting for 93% of the total, increased by 32%. The cost ratio of FI deposits was 1.06%, a decrease of 25 basis points.
Fourthly, the wealth management and asset management business accelerated development and further enhanced professional capabilities. Wealth management business realized rapid growth. Retail WMP balance increased by 8.84%. Even though the volume of agency sales of non-money market mutual funds decreased by 7.84% year-on-year, we see more allocation towards equity-related products. The sales volume of agency distribution of trust schemes and the insurance premium increased by 175.24% and 32.77% respectively.
The number of customers who conduct asset allocation under the TREE system reached 11.3 million, an increase of 9.17%. The average daily balance of corporate WMP was CNY 459.05 billion, an increase of 14.8%. The scale of asset management business amounted to CNY 4.45 trillion, remaining stable. The balance of assets under custody was CNY 24.14 trillion, an increase of 5.96%. Fifthly, we implemented regional development strategies and enhanced development capabilities in key regions. We focused on national strategies of coordinating regional development, followed the trend of industrial cluster development, and promoted the branches located in the Yangtze River Delta, the Pearl River Delta, Chengdu-Chongqing region, the Western Taiwan Straits Economic Zone, and other regions to further develop.
Customer-based AUM from retail customers, core deposits, and other indicators all showed higher growth rates than those of the average level of domestic branches as compared with the end of the previous year. Their contribution within the bank was continuously increasing, and the core deposits and the balance of loans of the company's 16 branches in key regions as a percentage of all branches increased by 0.43 and 0.22 percentage points respectively. Third, we enhanced development and productivity of global and integrated operations. For overseas business, we seized opportunities, maintained stable and sound operations, and improved the level of internationalization in institutions, businesses, talents, and management. The total assets of overseas institutions increased by 6.56%. Net operating income rose by 23.72% year-on-year. Among them, institutions in Hong Kong seized the opportunities of the continuous recovery of the Hong Kong capital market, achieved significant growth in business scale and value contribution.
Their total assets increased by 9.49%, and net operating income grew by 25.28% year-on-year. The AUM from retail customers of CMB Wing Lung Bank rose by 16.51%, and CMB International ranked number one in Hong Kong by the number of IPO underwriting in the first half. Cross-border business accelerated to develop. Corporate customers in respect of international BOP reached 78.6 thousand, and the volume amounted to $222.63 billion. We improved comprehensive layout, enhanced development quality and efficiency of subsidiaries and JVs, and provided comprehensive services to clients. Total assets of major subsidiaries reached CNY 932.09 billion, up by 9%, and their net operating income accounted for 12.54% of the group's total net operating income, up by 2.92 percentage points year-on-year. Total assets of CMB Financial Leasing reached CNY 328 billion, up by 6.19%.
Balance of WMP of CMB Wealth Management was RMB 2.46 trillion, decreased by 0.4%, remaining number one in the industry. The scale of mutual funds under management of China Merchants Fund amounted to RMB 896.6 billion, an increase of 1.93%. The scale of entrusted management of insurance funds of Cigna & CMB then was RMB 214 billion, an increase of 12.85%. We were also approved to prepare for the establishment of CMB Financial Asset Investment Co., Ltd., marking a new breakthrough in our integrated business layout. Fourth, we accelerate digital and intelligent transformation and strengthen technology advantages. We innovate technology at the foundation level and strengthen model performance and computing efficiency to establish easy-to-use and fast-integrating enterprise-level AI middle office. We implement large-scale AI models across 140, 84 scenarios in retail, corporate risk control operation, and other areas, effectively improving business efficiency and service.
Customer service moving towards the digital and intelligent stage. We leverage large models to enhance the intelligence service level of the intelligent wealth assistant Xiao Zhao, initially establishing the corporate intelligent assistant AI Xiao Zhao to assist customers in handling complicated operations of the corporate financial products. Accelerating towards intelligent internal operations and management by implementing an AI-first strategy, we fully advance AI applications and introduce assistance across multiple areas, including retail, corporate risk and compliance, operation, and IT development, saving a total of 4.75 million working hours for the bank's management. Fifth, we enhance comprehensive risk management and maintain stable asset quality. We promoted comprehensive risk management, closely monitoring market changes, stepped up efforts to control risks in key sectors, enhanced internal control and compliance management level, firmly maintaining fortress-style risk and compliance management system and upheld the bottom line of risk management.
Corporate loan NPL ratio was 0.93%, down 0.13 percentage points as compared with the end of the previous year. Property industry NPL was 4.74%, down 0.2 percentage points. Manufacturing industry NPL ratio was 0.44%, down 0.05 percentage points. Retail loan NPL ratio was 1.03%, up 0.07 percentage points as compared with the end of the previous year. Mortgage NPL ratio was 0.46%, down 0.02 percentage points. Credit card NPL ratio was 1.75%, same as that at the end of the previous year. Microfinance and consumer NPL ratio was 0.95% and 1.41% respectively, up 0.16% and 0.37 percentage points as compared with the end of the previous year, maintaining a relatively excellent level in the industry. Finally, I will give a brief introduction to the business strategy for the second half of 2025.
Looking ahead to the second half, the external environment remains complicated with both challenges and opportunities for the banking industry. On one hand, the banking industry continues to face the challenges of low interest rates, low interest spreads, low fee rates, and intensified homogeneous competition, and its overall operations are still under pressure. On the other hand, China's economy continues to maintain a momentum of recovery, providing a sound operating environment for the banking industry. In the second half, the group will further advance its value creation bank strategy, adhere to the coordinated development of quality, profitability, and scale, accelerate the transformation towards internationalization, comprehensive operation differentiation, and digital and intelligent development, steadfastly pursue a drive-driven development model of strict management and upholding fundamental principles while breaking new ground. First, we will consolidate business foundations and enhance refined management practices. We will continue to grow and optimize our customer base.
We will also strengthen asset and liability management and enhance the efforts to obtain high-quality liability and asset origination so as to maintain our NIM advantage, promote the restorative growth of non-interest income-related business. We will also enhance cost management, establish and improve input-output evaluation systems, optimize resource allocation, and continue to promote cost reduction and efficiency enhancement. Second, we pursue differentiated development to expand core competitive advantages. We will secure the dominant position of retail finance, consolidate and enhance the systematic strength of our retail finance business, and leverage the recovery of the capital market. We will seize opportunities to accelerate the transformation and upgrading of our wealth management business, strengthen core capabilities, addressing weaknesses. At the same time, we will build up our market share in key regions, key areas, and key businesses, cultivate new advantages in niche segments using targeted breakthroughs to drive overall competitiveness.
Third, we will enhance global and integrated operation capabilities. On one hand, we will continue to improve the quality and efficiency of overseas institutions, particularly those in Hong Kong, while increasing the share of overseas cross-border and FX business. On the other hand, we will capitalize on our full spectrum of financial licenses and broad business presence to strengthen collaboration, integrate resources, and enhance both comprehensive customer service capability and income diversification. Fourth, we will foster innovation-driven growth and accelerate to construct digital and intelligent CMB. We will seize the opportunity brought by AI development, strengthen technology infrastructure, and lay a solid foundation for innovation in the AI era. We will build leading knowledge and data capabilities to establish clear advantages and to shape an AI-driven innovation ecosystem and continue our exploration in the human plus digital intelligence model. Fifth, uphold disciplines and strengthen comprehensive risk management.
We will adhere to a prudent and sound risk culture, enhance risk assessment, and continue to prevent and resolve risks in key areas. We will step up efforts in the collection and disposal of NPL assets to ensure asset quality remains stable, and we will maintain strict control over credit market liquidity and operational risks while reinforcing anti-money laundering and compliance management, thereby providing a solid support for sustainable development. The above mentioned is our strategy for the next half. Thank you, President Wang. For the next session, we will enter into the Q&A session. Please follow the instructions given by the operator, and please state your name and the institution you represent before you raise the question. Now we will enter into the Q&A session.
Please raise your hands on your iPhone, on your phone, or you press raise a question on your PC. Since time is quite limited, please only raise one question for each institution and also state your institution that you represent yourself before asking questions. Now, the first question will come in from CITIC Securities, Ms. Xiao Feifei. Thank you for giving me this opportunity. I'm a chief researcher in CITIC Securities. Currently, I think that congratulations to CMB's first-half results, especially you have made a positive profit growth in the first half and brought us much confidence in the bank's operation. So my question is for Mr. Wang, Mr. Wang Liang. We're seeing now there are some positive trends in the market, like the warming capital markets. And my question is whether CMB can continue to have this positive growth trend in the second half. Thank you for your question.
After we released our results last Friday, many investors and there are many analysts are writing articles about our performance in the first half and also have given us judgment and also confirmation and also suggestions for our operation. I think we truly accept all the advices and suggestions and also absorb these kind of suggestions to our operation. Just now you said that in the first half, we have recorded a positive profit growth, whether we can continue this trend in the second half. I think from my point of view, I think in the first quarter, we are facing very big pressure because from the 1st January, we were facing LPR repricing, which means that there will be a higher pressure on our NIM contraction and which also have a big pressure on our total operating income.
In the second quarter, we think that the second quarter's performance is better than the first quarter. We think in third quarter and the second half, we believe that we will be able to have made steady progress and trending towards a better situation in the first second half. In the second half, I think we will continue to implement our strategy and also requirements from the board, especially under this environment, especially with a contracting economy and also the lowering of the interest rate environment. We will continue to balance our business development among different business lines and also better manage cost control and also to concentrate our resources in major areas and to improve our wealth and other fee-based income and also better manage the risk and also asset quality.
With all these measures taken, we have the confidence that continue to make steady progress in the second half and to reach our budget goal, which was made at the beginning of the year. Thank you. Second question, please. Second question is from Mr. Zhang Shuaishuai from CICC. Thank you for giving me this opportunity. My question is for retail banking. I think that it's quite a bottom period for retail banking, and I think there is less talk about retail restructuring, and we are seeing higher risk in terms of retail side. So my question is, will retail continue to be a major strategy of the bank, and how will you carry out that retail strategy? Secondly, when we look at the retail operation, I think that you have quite a stable retail asset, and now we are seeing improving wealth management.
So looking forward, how can you expand your advantage in retail banking, and what are the specific measures that you would like to take? Thank you. This question is for Mr. Wang Ying. Thank you for your question. I think there are some difficulties and challenges facing the development of retail banking, but we do have sound development in the recent years, especially we have higher growth on customer and also on the AUM side. And first half, we have reported a record high AUM growth, and also we are seeing higher growth on the wealth management fee income as well. And there are three major aspects, areas that we have been working on in the following years. The first one is that we are focusing on major areas like the deposit and also settlement and clearing.
We are placing more emphasis on settlement and clearing, including credit card and also debit card, and try to be the prime bank of our customer and to innovate our settlement and clearing business and to build an ecosystem for our settlement environment and to make it easier and also more convenient for customer use the cards of CMB. We think that settlement and clearing is the most basic banking service that we can provide for our customer. So providing a more convenient banking account and also related services to our customer is our top priority in the last few years. Secondly, we use 1.5 years to kind of build up and also to upgrade our people plus AI and technology service model and to optimize our team building and also to empower our team with technology.
We think that new productivity is very important to service this new environment, and our advantage for us is to reorganize our resources for retail banking to meet the new requirements in the new environment. We call it that people plus technology. This strategy is not only a goal that is lagging behind us, but it's rather something that we are implementing already, and we have already shifted to the new people plus manpower plus technology model. The results have been shown in our operating income, in our profit growth as well. In the future, we think we will benefit more from this kind of a strategy upgrading. And thirdly, that is to apply AI into retail banking.
I think it's the best scenario that AI can be applied, and we focus on AI assistant, namely AI Xiao Zhao for our retail banking, and we have achieved quite positive results, and our assistants are servicing more than 20 million customers, and also AI assistants are servicing all of our retail relationship managers and the meeting back office employees and also help us to improve efficiency, and we are also going to optimize our business structure and also embed AI assistant, embed this kind of AI colleague into our whole system, and our employees will help to nurture and also do this kind of AI assistant, which means that business will be led by our relationship manager, will be led by the people, and then will be assisted by the AI assistant. I think for retail banking, very important are three pillars. The first one is technology.
Technology is the most important thing for the advancement of the retail banking. CMB's technology is very highly integrated with our business, and our technology fully understands the business so that we can provide a series of innovations, including All-in-one Card or All-in-one Net, which have led the industry in the past. Secondly, pillar is the team. Our team is very important. It doesn't mean only the team from retail banking, but also team from our other business unit. It's like Mr. Wang Liang said that in China Merchants, everyone talks about retail, everyone does the retail business, and it's kind of a common goal for the CMBers. Thirdly, it's our philosophy to create value of our customer.
It's not only some slogan on the wall; rather, it's embedded in everyone's mind and everyone's choices, and also implement this philosophy in our daily day-to-day practice, so we think that the enterprise can win at the end, that is, the enterprise can implement a philosophy, and fourthly, I think determination to implement this retail strategy is very important, and I think there are many always some questioning from the outside world, including a third-party payment and also fee rate cut, which also questioning our capability in wealth management. Currently, we are seeing degrading of the consumption, and also there are many challenges for our credit card business as well as settlement business. I'm facing all the challenges while our retail banking continues to grow.
And from quarter to quarter, yes, we do have challenges, including interest income, including fee-based income, and also payment-related income, but we didn't give up any hope or give up any business. Rather, we see opportunities in good times and also to consolidate our business foundation in bad times. So I think no matter all kinds of customer, all class of customer, and also all kinds of business, including wealth management, private banking, basic banking, we are very firm and also stick to our strategy and also look back at what we have done right and what we have done wrong. So I do hope that analysts and also shareholders will more focus on the business foundation of CMB, whether we can control the risk, whether we are still market-oriented, whether we continue to be innovative, or we continue to develop technology. These are more important rather than Q2Q results.
Thank you. Thank you. Next investor, please. Next investor is from Katherine Lei from JP Morgan. Thank you for giving me this opportunity. My question is about NIM trend and recently about the pricing of the deposit and also loan and also the launch of the anti-involution policy, so how it will help with the bank's NIM. And thirdly, from deposit side, my question is about the daily average demand deposit, whether it's affected by the capital market, and whether do you have a higher demand deposit proportion, and do you have further room to reduce your cost of funding. And looking in the future, if continue we have symmetric rate cut, so how are you look forward to a stabilization of the NIM? Thank you. And the question is for Mr. Peng. Thank you.
I think after we release the semi-annual report, I think NIM is quite a focus of all the investors, and I also saw some of your reports. I know you understand the current interest rate environment, but also I think there is some hope that you hope we can reduce the contraction level of our NIM. So today, I would like to share some of my views on NIM. So three major aspects.
The first one is that in absolute amount, we are leading the industry in terms of NIM absolute level. And secondly, we face pressure. And thirdly, I think that it's controllable NIM contraction. Firstly, in absolute amount, our NIM is 1.88%, and from an average banking industry level, it's around 1.42%. So we are 46 basis points higher than the industry average level. And as far as we know, that we are the best one in the industry.
So this is absolute leading in NIM number. And secondly, but still, we are facing pressure on NIM side because it's related to our own business features. Definitely, we have some common pressure with the industry, but we also do have some specific and our own distinct fixed differences. Like the common things are like that the LPRs are all coming down, and the level of the decrease on LPR is higher than the decrease on the cost side. But CMB has something different than other banks, like the first one. In terms of the deposit cost, there will be less room for CMB to reduce the deposit cost and higher pressure. It's quite easy to understand because our deposit cost is already very low. It's 1.26%. It's far lower than our peers.
Against this background, I think that the room for us to further go down will be less than our peers. And also, we have the highest demand deposit proportion, which means that the room for us to continue to raise the cut down the deposit cost is less. So now the demand deposit rate is 0.05%, which means there will be only five basis points down if we go to zero. And secondly, for quite a very long time, we have a very strict control on high-cost deposit. We have to take different measures to make sure that we have a lower proportion of the high-cost deposit. So the room for us to further lower down to the demand deposit cost will be lower than the peers.
And also from the loan perspective, as we can see, mortgage loan last year, and especially this year, we are seeing repricing of the loan mortgage loan. And the backbook of the mortgage loan has quite a big impact on us because we have one of the highest proportion of mortgage loan. And this is also something that is different from other banks. And also from the asset structure, which makes us facing more pressure on that because we have a higher proportion on retail assets, over 50%. And retail assets especially have a high yield, especially like credit card. But if we are facing less growth on retail side, definitely we'll have some negative impact on our asset structure, which leads to lower yield, like the credit card down by CNY 23 billion compared to the end of last year.
And this is mainly because there's less demand on that. This is the same situation with the industry. That is why these are specific reasons for CMB, that is why we are facing more pressure on the NIM side. These are the areas that we need to further analyze how we can conquer the challenges from the external environment to continue to maintain a sound NIM level. Thirdly, my judgment for future, I think that the future will be under control. Overall speaking, I think that even though facing pressure, but we do have some beneficial environment, like the one thing is we think the external environment, there are more policies that have been carried out to stimulate the consumption, which definitely will be beneficial to the development of our retail loan and also credit card loan, like the PBOC focusing more on the NIM level of the banking industry.
You can see there's a close relationship between when they are cutting symmetric rate cut on both asset side and also liability side. This will also help to relieve the burden on the NIM side. Thirdly, the anti-involution policy is also applicable to the banking industry, which will curb or deal with the irrational competition among the banking industry. These are more favorable to the bank's operation. From CMB ourselves, we are also taking measures like we're stepping up to absorb more high-quality demand deposit and also high-quality low-cost deposit as well. Just now, you also mentioned the proportion of the demand deposit ratio, whether it will be affected by the capital market. I think currently, when we look at the deposit, there's a kind of a quasi-boom market. There's a boom market in the capital market.
It definitely has diverged some of the deposits to other wealth management-related products. But I think at the same time, we have a broader definition about the deposit, namely deposit from non-financial institutions, including our deposits relating to custodian business and deposit relating to capital market. Like the deposits coming from our financial institutions counterparties are growing like 33% higher than before. It means that even though there will be a divergence from the deposit, but the funding is still there. It means that the funding deposits from customers are going to the capital market, but then you return back from the financial institutions. So internally, we have a broader definition about deposit, including customer deposit and including the financial institutions. Now, the deposit cost for our FI is about 1.09%, and the demand deposit ratio is around 97%. So it's also a high-quality deposit.
No matter what the nature of the deposit is, as long as the cost is low, then that will also be a very good funding source. And thirdly, I think from the asset side, we will also make efforts in terms of asset origination, including corporate and also including retail banking, especially the retail banking as a focus, like credit card, like the micro and consumer loan, and also mortgage loan. We are making efforts on all these fronts, trying to originate more loans in this area. And also, at the same time, for risk pricing capability, this is further to be improved. This is also a very important kind of difficulty that we are facing. And fourthly, I think very important how we can better manage the asset and liability management, especially for the market asset allocation. By these measures to improve our NIM level.
I think overall speaking, I think NIM is leading around 46 higher than the industry level. We hope that the level of the contraction will be quite the same of the large-sized enterprises. We think it's already a harder result by all the major sides, as I mentioned just now. We do hope that we can maintain something, but from sequentially looking at, we think that NIM will still face the same level by facing pressure, downward pressure. On a year-on-year basis, we think that the contraction level will be smaller tha
n before. Next question is from China Securities, Mr. Ma Kunpeng. Thank you for giving me this opportunity. Good morning, senior management. Following the past question, talking about the anti-involution policy. Recently, investors are focusing more on anti-involution, and they will compare it with the 2017 supply-side reform.
I would like to understand the difference and similarities between the two. I would like to understand the view from the CMB senior management. For the last time's supply-side reform, it indeed contributed to the bank's performance as well as NIM. So I would also like to understand further about that after the anti-involution period, what changes will be happening towards our NIM and our development. Could you provide further outlook on our asset quality indicators such as NPL ratio and etc.? Thank you for your question. According to the central arrangement in different industries, there are many arrangements relevant to the anti-involution policy. Many enterprises, they have seen disorder in the market due to price competition. This is not good to the sustainable development of the market. How to reverse this vicious competition and bring back healthy competition to the market?
This is what the market and also our regulators have been doing. In my opinion, whether this time the anti-involution arrangement, compared with the 2017 supply-side reform, there are some similarities, but there are also some difficulties. First of all, in terms of the industry level, the industries causing overcapacity is different. For instance, the new three industries, there are some phenomena relevant to overcapacity, and these have brought the fierce competition in the market. To the enterprise level, for the past time, there are some zombie enterprises. For some provincial level, there are some enterprises that are from low end. These are the past round of supply-side reforms, major market players. For this time, the major market players in this round of anti-involution are innovative enterprises that are from the private sector. This is quite different from the last time.
For the methodology taken this time, it's also different from that of the year 2017. I believe that this time we could be taking various measures to bring orderly market regulation back to the industries. For the banks, we believe these can also bring a healthy environment to the banking industry to better control asset quality. For the banking industry itself, we have been also conducting anti-involution arrangements within our own industry. On one hand, we see some over-competition among our banking peers. For instance, the loan pricing, bond investment, the fee rates. Well, for some business cases, people will sacrifice prices to compete for winning the business. This will bring the uptick in the risk level.
So for CMB's perspective, we will support our regulators and other government bodies to promote the anti-involution arrangement and act according to the current requirement and to prevent and to provide a sustainable development of the industry back within the banking industry and realize the sustainable development within the commercial principle. We will embed this within our mind. And I think it is good to the bank itself to stabilize its loan and deposit pricing and etc. And it can also improve our asset quality. And these can all contribute to our future asset quality and our cost management.
I believe that under such macroeconomic situation and also the guidance of the banking industry to better support the real economy, combining all these factors together, we believe this guidance provided from the policy itself, the bank should seize the opportunity and strengthen self-discipline and maintain good risk management and stabilize our asset quality as well as the NIM to realize a sustainable and healthy development. Thank you. Thank you, President Wang. We will have the next question. The next question is from Xu Ran from Morgan Stanley. Thank you, senior management. I have a question regarding corporate finance. I understand retail has been China Merchants Bank's characteristic, but I would like to also learn something about corporate finance. I understand that you have been managing good risk control in the corporate business. How do you seek to develop in a differentiated way in the corporate business?
We see the recovery in the capital market. What kind of opportunity will it bring to the corporate banking business? And under the backdrop of anti-involution, will there be more opportunities coming from M&A and restructuring? Will there be any new opportunities and also loan business for CMB? Thank you. Thank you for your question, Mr. Lei, who has just been back to the head office in charge of corporate finance business. Thank you for CMB's wholesale business. We have always stuck to the differentiated development methodology, and there are several features. Compared to our peers, we have already established quite a qualified customer base compared with our peers. Our aggregate corporate customers was 3.36 million. We have a high level of sci-tech enterprises, which takes around 20% of our total customers, especially in manufacturing top players. We have already covered 80% of our total.
For the SME top players, we have covered over 30% of these types of enterprises. For listed companies or those capital market-related enterprises, we have already covered over 86% of them. Especially for those PE invested-related enterprises, there are around 190,000. Our coverage has already surpassed 59%. With such good quality and large customer base, this is one of our greatest features. The second part is we have a unique FPA perspective. We provide comprehensive financing to our clients. This is what we have been doing for the past 15 years. It is a unique perspective of operation to provide various financing channels for our clients. On the second hand, we could create a win-win situation for our partners, relying on comprehensive service capabilities. Among our total financing, this is CNY 6.42 trillion, and among them, non-traditional financing accounting for 41.4%.
Third is that what we rely on technology to provide transaction banking business to our clients. We have maintained a leading position. We have provided 8,800 groups to provide 380,000 enterprises below them to provide account service for them. We realized a year-on-year growth of 30%. We have also provided the Treasury Management Cloud service, our flagship solution to our client, which we have realized over 20% growth year-on-year. Our custody service, a CNY 1 trillion-level business, maintained top three players in the market. Our supply finance, supply chain finance business also maintained top in the market. The fourth is that we have enhanced our advantages in cross-border business and provide services to enterprises going global. For loans granted to non-residents, which for the first half has surpassed CNY 200 billion, a year-on-year increase of 20%. For FX business, a year-on-year increase of 36% has been secured.
For enterprises who have international business demand, we have connected them to over 100 representative banks to provide further services to them. And for the fifth perspective, we have provided investment banking and commercial banking services, integrated service to our clients. We have these capabilities to establish the friend circle, to build up an ecosystem to provide services to these clients. And third, we have the product matrix to provide investment banking and commercial banking business to these types of clients. For instance, in the bond underwriting business, we have always secured a top three position in the market. In terms of the sci-tech bond, our underwriting scale has ranked number one in the market. For the M&A business, we have maintained a 27% year-on-year growth in the first half of the year.
For the listed companies' clients, they have been the targeted group, the prioritized group we serve in the investment banking and commercial banking integrated service. We have a special indicator that measures the accounts that we covered for those we raised funds for pre-IPO clients. We have maintained a leading position in this area. For the first half of the year in A-share listed companies, their fundraising accounts we have covered for nearly 50% of these businesses. So I use the above three perspectives to describe our features of CMB's corporate finance business. Of course, we are faced with competition and challenges such as anti-involution environment, the fierce price competition in loan pricing and deposit pricing. I have to admit these challenges exist. For a long run, CMB always makes a balance between quantity and quality and obtains the principle to develop business under a controlled risk level.
Our corporate business NPL formation ratio was lower than 0.2% for the first half, so for the next step in corporate asset origination becomes one of our top priorities in our business. We will enhance our capabilities in this field, and we will focus on the following four aspects. The first one is sci-tech enterprises, including the upgrading of traditional enterprises, the new equipment enterprises, and these opportunities brought by the two types of clients, and second is the integrating and M&A opportunities arising from the capital market. These we have also seen accelerated pace in the market. We have been quite active in providing such kinds of services to the clients, and third is that to provide supply chain finance services to the clients. And the fourth, how to better integrate the transformation of digital infrastructure to provide better services in the inclusive finance sector.
The region that we grant inclusive finance loans is mostly concentrated in the Yangtze River Delta, Pearl River Delta, and also the Bohai Rim. The three regions account for 80% of the loan increments. The industries are mostly on manufacturing, leasing, and commercial service, and also electricity, heating, and gas and water industry, water generation industry. The full direction, as stipulated by President Wang, will serve in the future direction of our development and will contribute better to our return that we aim to bring to the shareholders and investors of the bank. We will have the next question. The next question is from Zhang Zhuojia from Citi. Thank you for giving me this opportunity. I have a question regarding retail. We see from many banks that the retail asset actually worsened in its asset quality since quarter two.
When can you see the peak of the NPL performance of assets in the retail sector? After we see some interest subsidy policy introduced for the retail loan, will you adjust your KPI to encourage the consumer loan? Do you see any improvement in the demand? How do you prevent the funds to flow to the arbitrage? How, for instance, in the equity market or early repayment of mortgage, do you control the risk in this type of asset? For the whole industry, we do see challenges in the risk from retail assets, which are reflected by many areas. Influenced by the slow economic growth and the downward trend in the property market and also the declining income of the residents, the retail credit assets are also influenced by these factors, which is following the same trend with the environment.
We also see some uptick risk in our retail sector. On the one hand, this is because of the external environment. On the other hand, it is because of our own risk control. We tend to be more prudent in terms of the retail asset quality, even though our risk indicators are seeing some uptick, for instance, the NPL ratio, the special mention loan ratio. But for the absolute level, we're still maintaining in quite good compared with our peers. To answer your question regarding the retail credit risks, what's our view on the future development trend? We divide the retail credit into two parts within the bank. One part is retail credit. On the other hand, it's retail asset with credit card. In our opinion, the trend, we don't see any turning point from our perspective. For the credit card customers, the risks are in a more bottom level.
For us, we can see it as an early warning indicator. We have conducted an analysis for the credit card business. The NPL ratio has shown its increasing trend since 2019. Along with the pandemic's influence, there was a significant increase across the market. From then till now, it has been six years. Only in the year 2021, we have seen some improvements. For the rest of the years, the credit card business across the market, the NPL ratio is always in a downward trend without seeing any turning point. You can see from the credit card business to the whole business of retail, which is to say that the risk is still in the process of exposing the decreasing pricing of the mortgages and some other influencing factors. These risk factors are combining with each other.
For the bank's overview, the bank's view over the market, how do we deal with the relationship between development and risks? We need to maintain a proactive attitude. For retail credit business plus credit card business, it accounts for over 50% of the bank's loan. It's the cornerstone of our business. We need to enhance our capability and explore more potential to grow, to satisfy the need of customers' demand, and to promote the high-quality development of credit business of retail. But on the other hand, we need to be highly cautious to balance the quality, profitability, and scale development. This is our philosophy. And the quality has been the first and foremost priority that we pay special attention to. The bank's credit card NPL ratio in 2019 and in 2020 all showed an increased trend.
But in the year 2021, we take early measures of low volatile and steady philosophy. So even though there was some uptick in the credit card business asset quality in the whole banking industry, but for CMB, our NPL ratio and NPL formation ratio still remain stable and maintain the best in asset quality in the industry. So for retail credit business, as one of the players in the market, we cannot go against the trend of the market. We see some increase in the risk in the retail asset business, and there are still some trends of continuing to increase. But overall, the asset quality is stable. Where does our confidence come from? First of all, our risk culture is prudent and stable. We have good customers. We have good collateral. And we have 90% of our clients coming from these good businesses.
And for those retail businesses with collateral, there are over 80% of them. We see a very good safe cushion for this business. Third, we have the confidence because in the short or in the mid to short run, we have paid special attention to the risks. We see that China's economy is going in a good momentum. It is recovering. Since this year, the central government has launched several policies, such as interest subsidies and other policies. I think that the recovery of the economy and the positive momentum will continue to contribute to our retail credit business. In the future, we believe that the environment for the bank to operate retail business will be improved, and the bank will be transformed from pure price competition to the competition that takes service as the center, that takes technology capability as the center.
In safeguarding our bottom line of risks, we will make sure that our asset quality is maintained at the top level of our peers. We will continue to position the retail finance as the dominant role and to guarantee their role as the cornerstone to the contribution of our loan in the overall arrangement. Thank you. Next question is from Ma Tingting. Thank you for giving me this opportunity. I'm from Guosheng Securities, Ma Tingting. My question is for fee-based income. Just now we noticed that in the first half, we are seeing less decline on the fee-based income in the first half of CMB. And how do you look forward in the second half? And secondly, I think that there is a drag from the payment-related fee-based income.
So, whether it's because you are controlling the risk and whether it's because of more fees competition from the third-party payment parties. And another thing is that for credit card business, we have seen that the regulator has lowered down the credit card loan pricing. So how would CMB adjust your credit card business, and when it will be better? So for fee-based income, we'll be answered by Mr. Peng, and also for credit card business, we'll be answered by Ms. Wang. Thank you for your question. As for fee-based income, I think fee-based income is a very important component of the non-interest income, including fee-based income and other non-interest income. So I will share my views on these two parts.
For fee-based income, the highlight of the first half is the wealth management fee income for three years, the first time to have a positive growth around 12%, so over 11%. So this is the biggest highlight of the first half, including agency sales of the wealth management, agency sales of trust products, agency sales of the mutual funds are all growing. But for agency sales of the insurance, we have seen a growing amount, not volume, but the fee-based income is coming down. This is mainly because of the mix. The structure of our insurance is changing, and many of them are coming from commercial retirement. The fee coming from this kind of insurance will be realized year by year rather than it's not a one-time fee income. So I just want to assure you to have confidence in the future growth on our insurance fee income.
Also, we are seeing quite good some momentum in the custodian business contributing to the total growth of the fee-based income. But also, we are facing pressure on fee-based income. The biggest pressure is from our credit card. I think it's highly related to the transaction of the credit card. In the first half, transaction volume has reached CNY 2 trillion. Compared to last year, it is a decrease of 8%. But our market share of the transaction value is increasing by 0.3 percentage points. So it's mainly affected by the weak consumption environment. So it's highly related to that. And at the same time, our credit card fee income has down by 16%. But the customers with the transactions are growing.
It means that per transaction ticket is coming down, which is the main reason of the decrease in the total transaction value and also the main reason behind the decline of the credit card fee income, and credit card fee income is quite a very important component of our total fee income, so that is why the impact will be bigger, and also, another drag for our total non-interest income is other net interest income. It's a negative growth around 12%. This is mainly affected by the financial markets because this year's interest rate trend is different from last year. Last year was a bull market for the debt market. In the first quarter this year, we are seeing a rebounding of the interest rate, and second quarter, the short-term interest rates are also higher than last year, even though there is some decline on the long-term interest rate.
But these all have a negative impact on our other non-interest income, so these are the two drags for the first half. When we look into the second half, we are confident, as Mr. Wang said, to achieve a steady progress on the fee-based income. We are confident on that and for other net non-interest income, I cannot assure you because it's highly related to the market interest rate, especially we are seeing a rebounding of the interest rate very recently, so it's a little bit hard to judge now, so I will pass on to Ms. Wang and for your second question about the credit card business, just now, recently, the regulator has kind of canceled the ceiling on the credit card loan pricing. This is a very new regulation.
We think that the overall pricing for credit card loans will be stable, mainly based on the two reasons. The first one is that our credit card loans are mainly coming from installment payment. Over 20 years' involvement, banks have already had quite a mature risk pricing business model for installment business. The regulator has also a kind of mature framework regulating installment, including how banks demonstrate their pricing to consumers. I think for different customers already have differentiated risk pricing. This time, the cancellation of the ceiling or regulation of credit card pricing doesn't have an impact on the installment payment pricing. For the revolving loan pricing and also for the installment pricing, the regulator's guidance is that the price should cover the risk.
So should namely to have the risk pricing model, and banks can have differentiated pricing to improve their market competitiveness. CMB has always been implementing market regulation, and we have scientific risk pricing mechanism and also risk and pricing management internally. We think that the overall credit card pricing will be stable. Just now, Mr. Peng said that we have seen some decline on the fee-based income. One of the drags is coming from the credit card business. Even though we are seeing an increase of 43 percentage points increase in our market share, but due to the decline in the total transaction value, we are seeing a decline on our fee-based income related to credit cards. I think credit cards is also a focus of the market. I would like to share some of my views on the industry.
I think the credit card industry is kind of shifting from a high-growth environment to a high-quality growth. It's facing more risks, and also it's seeing consumption degrading, and it's kind of a shifting period. I think it will be quite a long-lasting. Some of the credit card centers already cannot grow at a normal speed, and some are facing very big risk pressure. So it's quite a feature of the transformation period that some will be faced out by the market. But from our view, we think that we are confident in the whole development of the credit card industry because the government is also launching positive measures to stimulate consumption, and credit card is targeting a small amount of transaction, and it's also both can be a transaction vehicle as well as a vehicle for loans, so it's different from other simple retail loans.
And also, the line of the credit card line could be revolved, and it means that the card users can use the card as a settlement vehicle and at the same time to get some credit from the line. And we have a dynamic risk model for credit cards, and also it's quite a good area to analyze the risk of the retail loans. So we think that credit cards will continue to play a pivotal role in the whole consumption industry. And for CMB, the credit card business is also an important vehicle that will service our 200 million retail customers. And it also contributes a lot to our total SSI, retail SSI, retail operating income.
And credit cards and debit cards are both servicing the customer and providing the transaction and settlement and clearing services for our customers and attracting young people and to help CMB to be the first choice for young people and be one of the reasons that the customers trust us. So I think that credit card business is very important, not only in the past, but also in the future, we will highly emphasize on the credit card business and also play higher requirement on the development of our credit card business. Next, please. Next question is from Guosheng Securities, Mr. Zhu. Thank you for the management, and thank you for giving me this opportunity. I'm from Guosheng Securities. I have a question for the internationalization operation of China Merchants Bank. So it's the first year of CMB to launch your international business strategy.
So, over half a year, what is your kind of feelings from these kinds of international operation strategy, and do you have something to share with us? Thank you for the question. And, in order to respond to the low interest rate environment, we have launched a strategy. The first one is to develop, have a faster development in terms of international operation. I think it's following the external trend, namely many Chinese enterprises are going abroad or accelerating their pace to go abroad. So, it needs Chinese financial institutions to provide the related services. And secondly, China has become the second largest economy in the world and has been a very integral part of the world's economy, and it's already related to many countries and regions. So, CMB's business should also be involved or developed in many areas and regions.
Also with the internationalization of RMB and the One Belt O ne Road strategy, I think it's the biggest trend in the external environment. We are following the trend. Secondly, I think in the Chinese market, almost all of the Chinese banking industries are focusing on the Chinese markets and Chinese assets. When we are facing interest rates coming down, we are both facing needing contraction. It's kind of a bottleneck for all the banking industries. How we can conquer this bottleneck, I think international operation is a very important key to cure this problem and also help the whole country to build up a strong financial system in the world. All major economies in the world, the financial institutions there are all operational, are international and global financial institutions. It will be the same case for Chinese banking industries' future.
So that is why this is some active move that we need to take, and for CMB, even though we have achieved sound and stable results, still you can see our business is focused on the Chinese market, how we can learn from other international financial institutions, and how we can follow the trend of the Chinese enterprises to go global, and how we can follow the trend of the national strategy. It's important for us to have an international operation. In Hong Kong, we have the CMB International, and also we have CMB Wing Lung Bank, and the International Financial Markets. We have our overseas branches. We want to leverage our overseas presence to improve our capability to service Chinese enterprises going abroad.
And secondly, I think with a deeper cooperation with the global financial institutions, it will also help us to improve our own management and service capability and also learn from other first-class global financial institutions' experience to help us to improve our management capability and to improve our service and to nurture our capability to build up our own international team. So it's not only an internationalization of the presence or distribution channel you have, but also it's an internationalization of your management level, and it's also an internationalization of your team. So by doing so, we can better help to service the clients and help us to respond to the low interest rate environment and to have a long-term sustainable development. So in the first half, yeah, it's the strategy we have launched at the beginning of the year.
But for the past two years, we have already been making efforts in these regards and improved the capability of our overseas branches. And you can see from the asset growth and also from the profitability and also contribution to the bank from the overseas branches. I think they have achieved some results, but I don't think it will be a short-run strategy. It might take a longer term, like three to five years, to really have the capability to have a global operation. And I do believe it will be a real driving force in the future. Thank you. Next question, please. Next question is from UBS. Thank you for giving me this opportunity. I'm Helen from UBS. My question is about the capital management.
As we have seen quite a rapid growth of your RWA in the second quarter, and in the second quarter a big decline of your core CAR ratio, and RWA growth rate is higher than 8%. So the decline on the CAR ratio, I think, may be related to the expansion of your asset book. And I think it's related because you have higher allocation to corporate banking, but the corporate banking business usually has a lower yield compared to retail. So how do you look forward to your CAR ratio and whether the CAR ratio will continue to decline? Thank you. This question will be answered by Mr. Peng. Thank you for your question. For the CAR ratio in the first half, the matter is that the advanced approach or standard approach or our CAR ratio are all declining compared to the end of last year.
I think it's related to the dividend payout ratio. If we exclude the factor from the dividend payout, our CAR ratio under the weighted approach, including Core Tier 1, Tier 1, and also the total capital ratio under the weighted approach, are all increasing compared to the end of last year. Under the advanced approach, it's still declining compared to the end of last year. So you can see that firstly, the biggest impact on the CAR ratio is dividend. And excluding the dividend factor, there is a phenomenon that the RWA growth rate is also fast. This is also the second reason why we have seen a decline on the CAR ratio.
The main reason behind the faster growth of RWA, the first one is that in the first half, especially when we are seeing weaker demand on the retail side, we have more growth on the corporate loans. The RWA growth on the corporate side is faster. Second, in June, we have also optimized our rating model for corporate. It means that we have a higher proportion on the risk. That is why you are seeing higher RWA growth rate on the corporate side. Third, for bond investment, this is the same situation that we have allocated more resources to bond investment. Market risk-related RWA is growing faster. Since we have capital strength, we have some periodic operations, namely for some flow assets like the bill discounting assets and also the LC discounting.
Some of the temporary flow assets, we are also adding up them, but it's a temporary reason for the first half. So because we have the capital strength, we have the capability to do some periodic operations to help to grow the overall profit. In the long run, I think our strategy is the same, namely stay firm to retail and to stick to the ROC goal and to strengthen our capital management. I think that in the long, for the whole year, RWA growth rate will be in line with our goal like 9%. So this is quite the same like in the past that annual growth rate of RWA level will be stable. And for profit for the whole year, it's hard to predict and also because they will be affected by many general environments.
So, I think excluding all the dividend payout ratios and also excluding the payout ratio for the preferred bonds and also for the perpetual bonds, we hope that we can continue to maintain a sound and stable CAR level. Thank you. Next question is from Goldman Sachs. Thank you, senior management. I am Wang Ziheng. I would like to learn from the senior management under the insufficient credit demand from the society. What's your view on the demand side of the industry on the corporate side? And what industry are having weaker demand than others? What is your guideline of the corporate credit granting? And what is the major growth point in the major industries? This question will be taken by Mr. Lei.
I should say that since the beginning of this year, the macroeconomic condition under this backdrop, corporate loan has become the major growth driver of all loans for the first half of CMB's corporate loan growth on a year-on-year base. The growth rate was 7.89% on the group base is 8.04%. It fits the trend of the markets, actually, as we feel, as what we sense about the demand side of the market in terms of its characteristics. There are several layers. The first layer is that from CMB's growth itself, manufacturing has a larger demand than other industries, especially those relevant with new technology input and new generation capacities building, including manufacturing of infrastructure and the green area. While relatively speaking, for the property and those industries with overcapacity, their demand is relatively weaker. So government-related companies, their demand is also stronger than others.
From other perspectives, our manufacturing, our leasing, and the commercial service industry, the electricity, heating, power, and water production industry, these are the three major industries with larger demand. Just now, I have also mentioned about the M&A and restructuring business opportunities. These will become also the industries with stronger demand for the next step. This is also our strategy for the next steps, corporate asset origination. We will enhance our capability and further accelerate the growth rate of our general loans. Our target for the first half, we have realized an 8% growth. And for the next step, we aim to secure a growth rate of over 10%. Thank you, President, Executive Vice President, Mr. Lei. Next question is from Yingfeng Capital. Mr. Duan. management. Can you hear me? . I can hear you very clearly . I can see you in the camera.
We will have the next question. We will have Mr. Ma from the Changjiang Securities to raise his question. Thank you, senior management. I am Ma Xiangyun from Changjiang Securities. I have a question relevant to a heatedly discussed topic of the deposit migration discussed in the capital market. I would like to understand CMB's view on this phenomenon. So for this round of residents' asset allocation behavior and structure, what changes do you see? And compared with the last round of cycle of wealth management development from 2019 to 2021, what's the changes for CMB's wealth management business arrangement, strategy, and your tactic? What is your outlook towards its income growth and also the market competition landscape of the wealth management business? This question will be taken by Ms. Wang.
Since this year, the retail clients' risk preference is experiencing some changes, but prudent steady is always the major tune. Under such backdrop, people are having stronger preference on equity products, equity assets. Combining with the recovery of the capital market and the low interest rate environment, we see some improvement in customers' risk preference, but we expect to observe further combining with the external environment. Under such changes, our wealth management strategies are as follows. As a wealth manager, we will do two things. One is to grasp the major market trend, and the second is to meet customers' demand. Comparatively speaking, from the 2019 to 2021 round of market cycle, the current market environment is something we need to focus on. Low interest rate environment, it's a future phenomenon. It's a future trend we will be experiencing for a long time.
We continue to see the lower rate in the market. We are seeing more true asset yield conveying to our customers. For CMB's clients, we wish that our clients can enjoy comprehensive service within CMB in a long, sustainable, healthy, and sound manner. We are also driving ourselves to make efforts in this direction. It is a great test for us. It is testing us for our capability to provide professional services to our clients, and we will strive to achieve our goal in the five following aspects. First, we will seek to provide asset allocation services to our clients under the TREE system. We will see to our clients' demand and provide asset allocation suggestions to our clients, during which every round of service we provide to our clients is very professional.
But for us, inspecting their assets and providing balanced service and suggestions to our clients are very important during the process. The second is to better innovate products and provide them to our clients. For CMB, our wealth management platform is a comprehensive supermarket. We have quality selected products. We have customized products. Customers, they have demand in active, in passive funds, in tools, in market, mark-to-market, and etc. We need to provide different allocations to our clients across their life cycle and to provide very accurate product supply to our clients in a very diversified manner. For instance, you know about the Five-Star Selection brand you're quite familiar with, and also you have the Long-profit FOF products that fit into the category of our product supply. We believe that customers are having stronger demand in asset allocation.
We need to enrich our allocation product line and to ensure that we can have very strong resources in the backend for our clients to make further selection. For instance, we have been enhancing our product supply in the cross-border sector. For instance, the QFII, QDII, and etc. In existing volume and increment of the cross-border products, we all see many growths in this field. The pre-fixed fixed yield of the insurance products, the market interest rates tend to be lower and lower. It is also asking the market players to be back to origin and provide the genuine guarantee type of insurance policies to our clients. We need to see and further dig into the demand of our clients so as to better provide products to our clients accordingly and to solve the problem of why customers should choose pure insurance policies.
The fifth aspect is to better embed AI into our products. It is a very professional scenario. In wealth management business, we have already embedded AI technology in internal management and customer service. On the customer's end, the AI Xiao Zuo has already provided service to 20 million clients monthly. Combining the latest technology, the AI Xiao Zuo is continuing to emerge and to iterate. Combining with different job requirements in different positions, we have embedded AI Xiao Zuo to help our relationship managers and other colleagues to enhance our efficiency in different business lines. So generally speaking, through huge pressures and a gloomy capital market for the past several years, we have seen some silver lining. So from our perspective, we believe the fee income of wealth management business will recover gradually.
Along with the growing of our AUM and the growing of our customer base, these have all formed solid support for the future growth of the fee income of wealth management business. We have also improved the structure of our wealth management fee income. We will continue to increase the ratio of the consultation fee and for the structure of our product mix. We have seen more potential arising from the changes of customers' risk preference. If we continue to see more recovery of the capital market, we will see a higher ratio of allocation from our customers into the equity-related products. Thank you. Thank you, Ms. Wang Ying. We will have the next question. We will have the question from Mr. Duan from Yingfeng Capital. Dear senior management, I can hear you. Please state your question.
Oh, sorry, due to the signal failure, please allow me to turn off the camera. Thank you. Congratulations on the positive increase of your profitability of the interim report. I have a question. How does CMB balance the interest for short-term and long-term? And under such backdrop, people are asking for temporary and also long-run return. How do you seek a balance between them? Thank you for your question. I think you're asking about how to balance the short-run and long-run in terms of the benefit. For a bank's operation, it is highly relevant to every aspect: micro and macro, short and long-run, quality and quantity, speed and the growth rate. These are all correlated with each other and influencing every other aspect. So about your question regarding the short-run and long-run, how do we benefit?
I have recalled a saying saying that if you don't have concern for the short-run, you will have in the long-run. So for us, for CMB, to deal with the relationship between the short-run's interest and long-run's interest is the key to our sustainable development, and it is the goal of our senior management in doing our task. Twenty years ago, during the days when President Ma was managing the bank, he has a saying that if you don't do retail business, you won't have a living in the future. If you don't do corporate business, you won't live at the time. I think it is very accurately describing the relationship between retail and corporate and also very flexibly describing the relationship between short-run and long-run.
So for the senior management, we believe it is a question we have to deal with about how do we deal with the current performance and how do we maintain a sustainable development in the future. I think operating a bank is like running a marathon. We are not doing a 100-meter sprint. Doing a 100-meter sprint is not sustainable. We need to maintain a long-term perspective to operate a bank. We operate risk, and risk, it's quite invisible. It is lagging behind, and it is contagious. So we cannot only look at the current performance, the current financial indicators, but neglect the risk in the future. The bank also has a task to support the real economy, to support every household, to support people's livelihood. So we need to walk steady, walk far, and to provide better service to our clients based on confidence and based on our credit.
We need to win the recognition of the market of our clients so as to better develop. So for CMB's senior management, as we deal with this relationship, we need to lay a solid foundation and look far into the future development. In laying a solid foundation, we need to strengthen our full foundation, our customer base, our talent base, our management base, and our business base. Only with a solid foundation can we walk far. At the same time, how do we walk far? How do we look further ahead? We need to strengthen our capability to make sure that we have a clear development goal to do the right thing and not to do something that we think is unnecessary. So this is how we balance the current development and future development to lay a solid foundation and look far ahead and walk far ahead.
How do we maintain our characteristics and features? I think the current characteristic should turn into our future sustainable capability. In my perspective, we need to build up the comprehensive development among the four major sectors: the retail, the corporate, the investment banking, and financial market, and also the extensive wealth management. It is very hard to achieve this goal, but only with a comprehensive development attitude could it support our comprehensive development in the future. We also support the four initiatives: the internationalization, differentiation, the digital, and the comprehensive cooperation to cope with the low interest rate, low interest spread, and the low profitability environment. This is also what we could do to support our future development and the need for our future development.
We also need to realize the regional development strategies, such as the Greater Bay Area, the Yangtze River Delta, and the Bohai Rim area. These key regions are the regions with quite good economic growth and where the future potential lies. We need to focus on these regions to support our development. In the differentiated and characteristic development, we need to maintain our own strengths and forge our distinctives. As we don't have future concerns, we will have some concerns for the current phase. We need to stand in the future to look at our current environment. We will see what we have been doing in a correct way and to avoid making mistakes.
We need to look into the future and stand on our foothold and to develop further, stand firmly, and seek future development to deal with the relationship between current development and future development and maintain our distinctive competitive edges, so this is my ideas, my views on the question you ask. To guarantee the rights of all of our shareholders, we have collected many questions from our investors beforehand, and some have already been answered just now, and there are some specific ones we will read out from individuals. Recently, the bond market has been seeing some turbulence and volatilities. So how does CMB's management see the future trend of the bond interest rate, and what is your investment strategy of your financial market business? Thank you. For the financial markets trend, just now when I talk about the income side, I have already touched upon that.
In the first half, we can see there's quite a big volatility in the bond market, like the 10-year Treasury bond. The band of the volatile band is around 30 basis points. So it means there will be harder for the investment of the bank, especially compared to last year. There was a one-way bull market, but this year is quite different. Volatility has always been there from first quarter till now, which plays a higher requirement on the bank's investment strategy. And very recently, we are seeing a rebound in the 10-year Treasury bond, again reaching around 1.8%. For some newly issued bonds, it's even higher than 1.8%. In my view, I think that why the interest rate has risen, has rebounded, there are several reasons.
The first one is related to the capital market, and the capital market is very active, which definitely has led to a rebound in the interest rate in the bond market. And secondly, about the anti-involution policy, since the attitude of the policy side towards inflation, that is why market rate has also risen. And thirdly, I think it might be related to the value-added tax on bond investment or banks' investment into bonds. There will be a recovery of the value-added tax. This also has some impact on that, which altogether led to a rise of the bond yield in the market. But in the long run, I think the interest rate of the bond market will trend down because the PBOC has countercyclical measures, and also the more loose has adopted a loose monetary policy.
So in the short run, there will be volatilities, and the market expectation is that the 10-year bond will move from around 1.7%- 1.9%. So our strategies are as follows. The first one is from the asset allocation perspective, we need to have an appropriate proportion of investment. It's like 30% currently. I think it's an appropriate level. It has risen a little bit, but it's an appropriate level for us. And secondly, under this asset allocation strategy, we need to buy more when the price is low and the yield is high. And thirdly, to take the opportunities from the volatilities and have more trading gains. So it depends on our capability of investment. And fourthly, maintain a proper duration because interest rate risk management is also very important for risk management.
Duration management should also be proper, and we think that the duration is proper, and it should not be lengthened. This is the duration management. Fifthly, to manage the derivatives to offset the risk. These are the major risk management measures that we have by all round and also professional investment strategy to help us to maintain absolute yield on our bond investment and to have more trading gains. Thank you. Next question. Next question is from Mr. Chen Shaoxing from Industrial Securities. Thank you. I'm Mr. Chen Shaoxing from Industrial Securities. My question is about ROE. CMB has a high ROE and high dividend ratio. I think this is why many investors invest in CMB. But CMB is now having a more faster decline on ROE. By the end of June, it's 13.85%. At this speed of decline, whether CMB's ROE will decline below 13%.
If CMB can maintain such a lower growth rate on the asset side in the next few years, maybe the ROE will decline to around 10%. In absolute amount, this will be quite a rapid decline. I remember management has mentioned before that for ROE, it's hard to maintain a higher than 15% ROE, but to maintain a relative ROE advantage compared to large-sized enterprises, I think the management were very confident. My question is that except from this comparative competitiveness, what is your expectation for the ROE level in the next three to five years? Thank you. Thank you for your question. CMB's ROE has been over 15% in the past at a relatively very high level. Last year, it was around 14.85%. In the first half, it continued to decline by 1.59 percentage points. Now it's around 13.85%.
I know this is a concern for many investors. So the ROE level is dependent on profit growth as well as the growth for equity and also for dividend ratio. These are highly related on that. In the past two years, we are seeing a slowing growth on the profit side. So the ROE has. This is the reason behind the ROE decrease, and we understand your concern. So from our internally, we think that we have set up an internal management mechanism, which is guided by our ROE-centered management system. It means to guide our business to contribute more to ROE, to make sure that we have a leading ROE among Chinese banks. Now it's 13.85%. The average level ROE level is around 9%. So we are around 4% higher than the industry level. We need to maintain our higher than average ROE level.
Secondly, we need to also satisfy investors' demand. You need to have a proper return on investment. If there's a too low ROE, it means that you don't need to invest in your bank because the opportunity cost is high. We need to make sure that among the listed companies, we deliver a proper and reasonable return to shareholders and to be a company that is worthwhile for investing in. Against this, among these objectives, our ROE level, how to balance among the ROE level and how to balance the profit growth and also equity growth as well as dividend payout. We want to. Our goal is to maintain a relatively high ROE level and to be responsible for our investor and to have a proper investment return to our shareholder. This is one goal of our management.
With our efforts, we think that we will continue to have our leading comparative advantage. Secondly, your question about what is our expectation for the next three to five years, I think it depends on our profitability, whether we will have a recovery on our profitability. Some investors are asking about whether we can increase the dividend payout ratio. So if you have a higher dividend payout, it means that you can reduce or decelerate the equity growth level. From management's point of view, we think we will take into consideration capital and business strength, business development, and external environment, as well as regulatory policies and investors' suggestions. We will have a comprehensive judgment on that. Thank you. Due to time constraint. Thank you, Mr. Wang. Due to time constraint.