Dear investors, analysts, media friends, good morning. CMB's 2019 results announcement now begins. I am CMB's EVP and Board Secretary, Liu Jianjun. I am also today's host. Because of the outbreak, this year's session is broadcast online live. It is also the first time that we combine the session for analysts and investors together with that for media. Three minutes ago, we were still wearing masks, but President Tian has urged us, as management team, to take the mask off so as to face our investors as we are. I will introduce today's attendance. From Hong Kong, we have Chairman Li Jianhong, Director Hong Xiaoyuan, Director Zhang Jian, Director Su Min. Attending from Shenzhen, we have President Tian, EVP Wang Liang, EVP Wang Jianzhong, EAP Li Delin, EAP Liu Hui, Chief Information Officer Jiang Chaoyang, and also head office departments head.
Attending online, we have domestic and overseas institutional investors, analysts, and media friends. All together, 524 of them. On behalf of CMB, for your attendance, welcome. I would also like to say thank you for your long-term support, investment, and attention to China Merchants Bank. Today's session covers two parts. The first part will be chaired by President and Chairman to introduce CMB's 2019 results, which lasts around 30 minutes. The second session is Q&A session to answer your questions, which lasts around to 11:30. Today's session will be covered by simultaneous interpretation in English throughout. Now, let's welcome the Chairman and President to introduce CMB's 2019 results.
Thank you, Mr. Liu. Dear investors, dear analysts, media friends, good morning. Welcome to CMB's 2019 results announcement. Today's session will mainly report three parts. First, I will introduce CMB's 2019 full year performance in brief. Then, President Tian will discuss details.
Finally, I will briefly cover our 2020 outlook and strategies. In 2019, as domestic economy faced greater downward pressure, risks and challenges substantially rose. CMB sticked to the Light-operation Bank strategy and maintained the One Body with Two Wings positioning. We grew our businesses steadily. Overall performance was continuously positive. Quality, efficiency, and scale was well coordinated. We have the following six parts to share. Number one, capital returns improved and profit growth hit a seven-year high. In 2019, our net operating income was CNY 269.788 billion, up 8.59% year-on-year. Net profit was CNY 92.867 billion, up 15.28% year-on-year. Profit growth was the highest since 2013. ROAE, ROAA were 16.84% and 1.31%, respectively, up 0.27 percentage points and 0.07 percentage points from last year. Both figures rose for the third consecutive year. The board approved that in 2019, cash dividend payout rate would rise to 33%.
After shareholders general meeting's approval, it will be implemented. NIM rose by 2 basis points from last year to 2.59%. Funding cost remained low. Yield of interest-earning assets grew by 4 basis points from last year. Net non-interest income was CNY 96.698 billion, up 9.81% year-on-year. Growth picked up every quarter. Cost to income ratio was 32.08%, up 1.04 percentage points from last year. Mainly because to create a leading edge in Fintech, we continuously increased tech, talent, and other strategic investment. Second, asset quality was good. NPL balance and ratio both dropped for the third consecutive year. NPL balance was CNY 52.275 billion, down CNY 1.23 billion from last year-end. NPL ratio was 1.16%, down 0.2 percentage points from last year-end. Both balance and ratio continued dropping since 2017. Special mention loans balance and ratio both dropped. Balance was CNY 52.59 billion, down CNY 6.739 billion from last year-end.
The ratio was 1.17%, a substantial drop of 0.34 percentage points from last year-end. Asset classification standards were thoroughly performed. The ratio of NPL to loans overdue for more than 90 days was 1.18. Our risk loss composition capacity was further strengthened. NPL provision coverage was 426.78%, up 68.6 percentage points from last year-end. Loan provision rate was 4.97%, up 0.09 percentage points from last year-end. Number three, capital indigenous growth was strong. For the sixth consecutive year, there was no common stock financing. Under the advanced approach and weighted approach, core Tier one CAR and Tier one CAR both rose from last year-end. As Tier two capital bonds were redeemed without new issuance, our CARs slightly dropped. If we exclude this factor, our CARs under both approaches would increase from last year-end. As for the sixth consecutive year, we haven't performed any common stock financing.
Still, our CARs grew steadily, demonstrating our strong indigenous growth of capital. Number four, scale grew steadily and our market share rose as well. Total asset was CNY 7.42 trillion, up 9.95% from last year-end. Total liabilities were CNY 6.8 trillion, up 9.63% from last year-end. Loans and advances totaled CNY 4.49 trillion, up 14.18% from last year-end. Client deposits totaled CNY 4.84 trillion, up 10.08% from last year-end. Market share in both loans and deposits were improved from last year-end. Number five, tech investment increased and innovation-driven growth was furthered. In 2019, info tech investment was CNY 9.361 billion, up 43.93% year-on-year. It accounted for 3.72% of the entire revenue book. We strived to foster an open and inclusive climate, to tolerate mistake, and encourage boldness innovation. From a more open and forward-looking perspective, we pursued long-term returns.
Our Fintech Innovation Fund approved altogether 1,611 projects and invested CNY 3.66 billion, focusing on building the best client experience bank and digital transformation. We put ecosystem creation, digital operations, digital management, digital risk control, digital infrastructure, and innovation incubation, these six aspects on top of agenda. We made a series of progress and breakthroughs. Number six, for market cap, we see a record high and our brand influence is expanding. By 2019 year-end, total market cap was CNY 179.9 billion, ranked 10th among global banks. Our full-year growth of market cap was 47.95%, far higher than industry average. Our PB and PE ratios continued to lead major listed domestic banks, reflecting the broad recognition from capital markets. Our overall strengths improved. Global ranking rose with a number of key awards received. Our brand influence were further showcased. In 2019, The Banker produced the list of top 1,000 global banks.
We, in terms of Tier one capital, ranked 19th. For brand value, ranked ninth, up one place and two places from last year, respectively. In 2019, Fortune Global 500 list, we ranked 188th, up 25 places from last year. During Euromoney's 2019 Awards for Excellence ceremony, we were named as best bank in China. During Institutional Investor's 2019 All-Asia Executive Team selection, we ranked number one in all seven selections across Asian banking sector. Above is my brief review of our 2019 performance. Now, let's welcome President Tian to cover operational information.
Thank you, Chairman. Good morning, my friends. Next, I will introduce you on the following six aspects. Number one, our client base continued to grow, driving effective business expansion. First, retail client base further expanded. With positive growth of valuable clients, the total number of retail clients was 144 million, up 14.82% from last year-end, of which debit card clients and active credit card users were 117 million and 64 million in numbers, up 16.93% and 11.16% respectively from last year-end. Sum for our level and above clients number reached 2.6 million, up 12.07% from last year-end. Private banking clients number was 81,700, up 11.98% from last year-end, a record high for the past three years in terms of growth. Driven by expanding client base at all levels, our retail AUM grew by 10.17% from last year-end, reaching CNY 7.49 trillion.
Deposit and loans from retail clients increased by 16.53% and 17.12% from last year-end respectively. Number two, our corporate client base was more solid. Client services based on segmentation and classification were further improved. Corporate clients number was 2.1 million in total, up 12.94% from last year-end. Newly acquired corporate depositors number was 429,200 . Corporate deposits and loans were CNY 2.96 trillion and CNY 1.62 trillion, up 6.55% and 6.96% respectively from last year-end. Head office level strategic clients introduced 31 new names to 282. Corporate deposits daily average was CNY 654.8 billion, up 19.39% from last year. Branch level strategic clients number was 5,614, and the corporate deposits daily average was CNY 529.96 billion. Institutional clients number doubled in three years, reaching 35,400 at year-end, up 14.56% from last year-end. Institutional clients RMB deposits daily average was CNY 840 billion, up 8.92% from last year-end.
Small enterprises clients number was 1.99 million, up 13.76% from last year-end. Retail finance further strengthened as one body with a continued leading advantage. Profit before tax from retail finance business was CNY 65.16 billion, representing a year-on-year increase of 13.86%. Net operating income from retail finance business was CNY 142.56 billion, representing a 15.66% growth year-on-year, accounting for 56.71% of total net operating income, four PBTs higher than that of last year. Net interest income and net non-interest income from retail finance business grew by 18.19% and 10.9%, respectively, compared with the year-end previously. Sum forward level AUM balance and above reached CNY 6.09 trillion, representing an increase of 1.65 percentage point. AUM balance from private banking customers reached CNY 2.23 trillion, representing an increase of 9.4% compared with the end of previous year. Growth rate was 2.34 percentage points.
Balance of residential mortgage loans hit the CNY 1 trillion mark, increased by 19.23% compared with the end of last year. Credit card transaction amounted to CNY 4.35 trillion , representing a year-on-year increase of 14.62%, maintaining number one across the industry. Interest income and non-interest income from credit card business increased by 17.44% and 25.42% respectively. Premiums from agency distribution of insurance policy amount to CNY 94 billion, representing an increase of 33% year-on-year. Market share distribution ranked number one in the market. Sales of non-monitoring mutual funds were CNY 219.8 billion, up by 33%. Our sales of thousands of retail wealth management products grew by 15%. Third, more distinctive wholesale finance with improved professional service capabilities. New progresses have been achieved in institutional business. Coverage ratio of local government special debt insurance at provincial level was 77.78%, 23.5 percentage points higher than the previous year.
Accumulated derivative deposits were CNY 262 billion, representing a year-on-year increase of 92%. We have secure qualification of custody of occupational annuity in all provinces, with entrusted funds amounted to CNY 42.9 billion, 4.76 times the amount of previous year. The structure of our custody business was significantly optimized. Asset under custody of the company amounted to CNY 13.23 trillion, representing an increase of 7.13%. Amongst our scale of newly issued mutual fund under custody ranked number one in the industry. Competency of our investment banking business continued to improve. The value of bonds with CMB as the lead underwriter rose by 35.97% year on year to CNY 653.24 billion. Scale of both M&A financing and structured finance exceeded CNY 100 billion. Supply chain finance business was strengthened. There were 1,233 new supply chain loan customers in 2019. Innovation in transaction banking business was accelerated.
All-in-one card function was expanded to CMB corporate apps, realizing a comprehensive card-free operation. We also launched innovative products, upgraded and released CBS 7.0. We have maintained our leading position in bill discounting business. The company's bill direct discount business volume reached CNY 1.24 trillion, ranking the second in the market. We have seen robust development in our financial market business. Trading volume of RMB exchange rate swap rose by 8.94% year on year to $ 832.2 billion, and our trading volume of RMB option ranks fifth in interbank markets. Fourth, the transformation of our asset management business was accelerated. We have launched our wealth management subsidiary. The balance of WMP reached CNY 2.19 trillion, representing an 11.72% increase. Continued to rank second among commercial banks in terms of balance fund raised from the off-sheet wealth management balance.
New products in compliance with the new regulation was CNY 685.2 billion, accounting for 31.22% of the total balance, increased by 17.18 percentage points. CMB Wealth Management, our subsidiary, officially went into operation and launched new product naming system of [Non-English content] Its first product complete fundraising and started to accrue interest in early 2020. Fifth, enhanced risk management and with better asset quality. Retail NPL ratio was 0.73%, and corporate NPL ratio was 1.84%, down by 0.06 and 0.29 percentage points respectively. Special mention loan was 1.17%, down by 0.34 percentage points from the previous year. Overdue loan ratio was 1.41%, down by 0.17 percentage points. We kept making great efforts to dispose non-performing assets. For the full year, we disposed non-performing assets totaling CNY 45.66 billion, of which CNY 10.4 billion were collected in cash, accounting for 22% of the total.
We carry forward the construction of our risk management system that can address fundamental problems by performing structural adjustment, industry research, process reshuffling, and system building. Loan structure was safer. Proportion of retail loan was 55.73%, 1.3 percentage points higher than the previous year. Percentage of corporate loans from high rating customers was increased. Balance of strategic customers' balance totaled CNY 386.5 billion on the head office level, representing an increase of 23.57% from the beginning of the year. Financial exposure to industries we have reduced or withdrawn was CNY 123.99 billion, down by CNY 2.81 billion from the beginning of the year, reflecting an optimizing industry mix. We further supporting the list construction and credit name list. We also enhanced the coordination of our risk management system. We have promoted risk exposure managed with a customer-centric perspective, optimized asset portfolio management, and consolidate risk management system, expected the enablement of Fintech of our risk management efforts.
Sixth, our operation model has upgraded effectively with breakthrough made in digitalization. First, our digital operation capability was significantly enhanced. CMB App and CMB Life App has reached 102 million MAU, almost double in the last two years. Debit card and credit card customer acquired through digital channels were 24.96%, 64.32% respectively, 6.36 percentage points and 3.11 percentage points higher than that of previous year. 1,403 of our outlets have established online stores. CMB application wealth management sales were accounting 71.52% of our total. 89.96% of our total wealth management product customers use CMB App. Second, breakthrough were made in ecosystem construction. 2C business continued to penetrate in our customers' daily life. CMB App, CMB Life App had over 10 million MAUs engaging in 16 scenarios, becoming the key platform of retail operation.
Meal ticket, movie ticket, handy service, and public transportation services were launched and operating in hundreds of cities. To the business, we actively built our presence in corporate customers, integrated into the development of industry, internet, and explore and cooperate with core corporate customers to develop the online operation model of industry chain plus finance, and provide SMEs with online services, including aggregated collection. We have also deployed six other solutions, including smart industrial parks. Third, our digitalized risk management capability continued to improve. Libra System is able to intervene suspected fraudulent transaction, reducing the ratio of counterfeit and misappropriation by non-card holders to 8 in 10 million, representing a CAGR of -59% over three years. The accuracy of intelligent reading and pre-warning in our wholesale business keep improving, with the accuracy ratio of pre-warnings in the corporate customers with potential risk reaching 75%.
Actively promote AI and other Fintech in applying into the AML area, with AML monitoring analysis efficiency increased by 30%. Fourth, our operation and service efficiency was fully optimized. The Wind Bell System was launched, monitoring customer experience indicator as many as 923, achieving digitalized multi-channel and real-time experience and evaluation of customer feedback. 60% of our customer service workload was done by AI. We used end-to-end customer journey methodologies to increase customer experience. Fifth, we preliminarily built up a future-oriented digital infrastructure. The bank continued to promote cloud computing, hardware and software deployment and development. X86 service deployed increased by 60.67% year-on-year. The bank continued to enlarge the capacity of data lake to 9.8 PB, enhance the application of big data, and data in the lake increased by 68% year-on-year.
We accelerated use of AI, establishing customer service, public opinion, and intelligent customer service-related AI cloud service, and also knowledge management, digital marketing, and risk control to form an AI research and computation resources management platforms. Blockchain technology was integrated with our business and applied in various scenarios, including asset business collaboration. These are key operation information of 2019. Next, Chairman Li will discuss our outlook and strategies for 2020.
Thank you, President Tian. Now I'm going to share with you about CMB's outlook and strategy for 2020. In 2019, among complicated and changing operating environments, CMB adhered to our strategic positioning and continued to pursue strategic transformation with a long-term vision. We are driven by innovation. We continue to be a leading role in retail, and we strive to build the best commercial bank in China. We have delivered an excellent performance for investors. In 2020, we are faced with more complicated and challenging external environment, with significant downward pressure on the economy. Especially the sudden outburst of COVID-19 has severely impacted every dimension of the economy and the society.
However, the long-term improving trend for China's economy remains unchanged. The banking industry is confronted with both challenges and opportunities. We will stay committed to long-term goals and will continue to explore opportunities amid challenges. Actively promote works to ensure the sustainable and sound development of all business lines, accelerate the external opening up and internal integration. Currently, the banking sector is faced with four major headwinds. Firstly, macroeconomic downward pressure. Globalization and multilateralism are confronted with challenges. Anti-globalization begins to rise, sources of global volatility and risk increase. Global economic growth continues to slow down. China is now at a critical stage of shifting its growth drivers, challenged by structural, systematic, and cyclical issues. Despite that China and the U.S. has reached the trade deal, economic and trade conflicts between the two countries will persist for quite a period of long time.
Second is the outburst of the COVID-19. Production, consumption, and exportation have all significantly declined or even been ceased temporarily. This has directly interrupted China's economic stabilization and recovery. The banking sector will inevitably be affected. Our customer expansion, business growth, asset quality, and operation profitability will all be faced with pressure. Third, significantly increased source of risk. As the economic downturn increases, besides traditional risk, we also see new risk points. P2P platforms continue default, high-leverage operating companies are faced with danger, reputation risk, cooperative party risk, long-arm jurisdiction, collaborative turbulence in equity, debt, and low-end exposures, and these are all risks faced by banks. Competition from non-financial institutions. In the digital era, both financial and non-financial institutions have committed more resources to establish business ecosystem across various systems and strive their best to provide the best customer experience to their clients.
This disruptive innovation by non-financial institutions is changing the ecosystem of financial services. Although faced with great challenges, we can still see strong resilience and potential in China's economy. With the further implementation of the macroeconomic control policies, we will still see a long-term growth prospect. Thirdly, increased economic opening up. We will promote a higher level, broader scope, and deeper opening-up range, which will help remove the constraint from the development of the economy and will definitely provide new energy and dynamic for our further opening up. The opening up in the financial industry will also contribute to higher quality development of the banking industry. Secondly, the implementation of counter-cyclical macroeconomic control policies. Faced with the impact, we have more active fiscal policy and stable monetary policies, especially to face the impact brought by the pandemic.
Our government has also launched a series of policies, including the exemption of tax revenue of the enterprises and brought down the MLF ratio and provide low-cost funding to further enhance their confidence and capability to cope with the impact. Thirdly, booming digital economy. Digital economy has a far-reaching and profound impact on the economic and social development, and has significantly changed the way of production and living of our customers. 5G, big data, and other innovative technologies and applications will accelerate the digital transformation of the financial service. Especially after the COVID-19 pandemic, Chinese economy and banking industry's digital process will further accelerate. In the face of internal and external risk and challenges, we will seize present opportunities, adhere to our long-term strategies, seeking opportunities amidst challenges, and work to transform challenges into opportunities.
We will strive to achieve the goal centering around customer and technology, further foster digital operations, strive to achieve the vision of building the best commercial bank in China. Firstly, we will proactively compete for access to financial service in the digital era. Opening up is for creating service opportunities, while integration is to enhance service capability. We will keep externally in connect and opening up and connect with every partner possible to build ecosystem. On the other hand, we will strengthen internal integration, break down organizational boundaries, and effectively allocate resources to serve the market, and create value and enhance customer stickiness through a comprehensive mix of service. Secondly, we will seek opportunities among challenges and find structural opportunities under the impact. The pandemic is like a special stress test for all industries. The pains were intensified in industry structural adjustment, but also bring us with new opportunities.
We will keep reforming our workflow methodologies, make good use of online operation and management to enhance customer experience and creating better value for our clients. At the same time, caused by the impact, the industry will accelerate to exit and upgrade clients. We will look forward to develop more industries and clients that have higher potential to explore new room of growth. Thirdly, we will take prudent approach as always, and to improve our complete risk management system. We will stick to the philosophy of pursuing dynamic and balanced development of quality, profitability, and scale, continue to maintain a reasonable risk as asset growth, optimize the allocation among asset classes, solidify current achievements in risk management, and effectively control risks such as multi-indebtedness risk, concentration risk, and other major risks. Fourthly, we will commit to long-term goals and optimize market-oriented system. We will follow the market-based principle.
It is the foundation and assurance of CMB to deliver our performance. We will uphold the corporate governance system in which the president assumes full responsibility under the leadership of board of directors, insist on the market-oriented incentive mechanism, and maintain the stability of our management system, management team, and talent pool. Meanwhile, we will continue to strengthen and optimize the market-driven mechanism in our corporate governance, team and talent development, incentive mechanism, and technology innovation. This is basically the introduction given by us two. Thank you all.
Thank you, President Li. Our 2019 results announcement and 2020 outlook strategies now comes to a conclusion. Now let's move on to the Q&A session. In the beginning, we will ask investors and analysts to raise your questions, and then media friends can follow. Now let's have the first question.
Thank you. Now let's enter into the Q&A session. For mobile end, please press the raise hand button. From computer end, please also press similar buttons. Due to crowded attendance online, please limit your questions to one at one time. Please also identify yourself and the agency you represent. Ladies and gentlemen, if you wish to ask a question, for mobile participants, please click More and Raise Your Hand icon at the bottom of the video interface. For computer participants, please click Participants and the Raise Your Hand icon. Because there are so large number of participants today, please ask only one question for each time. Before asking questions, please first introduce your name and the name of your company. Thank you.
The first question comes from Guosheng Securities, Ma Tingting. Please go ahead.
Thank you. Congratulations to China Merchants Bank for solid performances, bringing excellent returns for shareholders. Thank you, management team, for this opportunity to raise questions. I'm Ma Tingting from Guosheng Securities. My question is about the COVID-19 outbreak. It has raised global attention. Our chairman has mentioned that our performances and operations in the future could potentially be impacted. This outbreak, what are the impacts on CMB's performances, aside from the first quarter short-term impact? Across the year, what will be the impacts on investments of assets, on asset quality? Will CMB change your strategies throughout the year? What are the measures you will take to mitigate the issue? Thank you.
Thank you for the question. I will take your questions in an overall sense, and then President Tian will put in more operational details. As you know, this sudden outbreak has certainly influenced global economy, finance industry, and also governance system with unprecedented levels. The first half happened in China. The second half is now spreading global. For China, under the leadership of the central government and of our party, state council, with the concerted efforts of people across the countries, now we have effectively curbed the epidemic, and we have made the temporary result at this stage. But now, the epidemic has now spread to the globe. I have read news that the outbreak is now affecting 186 countries, and altogether a quarter million were infected. Combining China, it's about 330,000. It is still fastly spreading in the European regions and also in the United States.
Global economy, global financial markets, and global management system, governance systems will all be affected. In terms of financial markets, you already see the fragileness. It is rising. After the circuit breaker system introduced in 1918, for more than 30 years, it happened for the first time in 1997. In the recent 10 days, that is across two weeks, four circuit breakers were triggered, which is unprecedented. The Fed has also introduced unprecedented levels of measures. These several unprecedented levels of things are quite rare in history. These are the impacts on financial markets. While for the impact on the global economy, there is the possibility for a quicker recession because of the heightened problems structurally. I have seen several days ago, the heads of states in Europe, they were saying the outbreak was the biggest challenge for them ever since the Second World War.
I personally believe we need to have a strong sense of crisis, not just a sense of risk. We need to effectively take out measures so as to mitigate the impact of the outbreak on economy, on finance, in our society. We need to try to minimize the impact. Number three, for global governance, there is also huge challenge. We see the problems and concerns of the society being highlighted. One of the examples you have seen would be the crisis for crude oil. The impact is there, and the drop is quite substantial in terms of crude oil prices. Be it for the real economy, be it for financial sector, obviously the impact will be there. As experts have said, the first half of the coronavirus happened in China, and the second half is now spreading global. The first half is now effectively curbed by China. Companies are restoring business.
March performances were obviously better than February, especially given the fact that central government has intensified efforts in emergency supplies and 5Gs. These are what we call new infrastructure and certain projects on old infrastructures, which has stimulated potential for consumption. The central government has also encouraged more deepening in terms of opening up for the financial sectors and other sectors. Number three, we are seeing the restructuring of global value chains, bringing opportunities for the bank. For CMB specifically, I do believe challenges are there, but also there are also opportunities, and now it is quite obvious for CMB and also for China Merchants Group in general. I am concurrently the chairman of both China Merchants Bank and China Merchants Group. Therefore, for the real economy companies, the average loss will be around 20% for the first quarter. But after March, we see the performances would pick up.
Overall speaking, for banking industry, I think there are possible opportunities. First off, there are structural opportunities, especially for financing of the infrastructure projects, either the new infrastructure projects or the old infrastructure projects. The demand is picking up. Second would be government purchasing on electronics and collaboration. These opportunities will pick up. Secondly, there will be recovering opportunities. The most direct recovery will come from retail, and indirect recovery will come from those companies that can bounce back after the sudden halt of business. There could be a bounce back in consumption and also in the performances of business. Number three, this will be opportunities from curbing against the pandemic. We are also seeing opportunities running from the new supply chain. As I mentioned before, there were challenges and there will be opportunities. Challenges are already there. Some of the opportunities are concrete.
I talked with the president about the concrete policies and measures being taken out by the government. These are concrete opportunities, but some opportunities are not that directly seen. We need to work hard to make it into reality. For CMB, we have made tests under different scenarios, optimistic, normal, and pessimistic. We have made estimations and also curbing measures accordingly. I personally would hope that the normal scenario will be the worst scenario, and I hope for the best scenario. I mentioned we need to have strong sense of crisis, strong sense of risks, so as to minimize the impact, so as to turn crisis into opportunities. We need to make preparation for the worst scenario and maximize our efforts so as to strive for the best results under the best positive scenarios. By next year, we will try our best to bring an excellent performance for you investors.
Thank you. I will ask our president to bring out more details in terms of specific impact.
I would say five parts. Number one is client acquisition. For the first quarter, especially for February, debit cards and retail credit cards, client acquisition speed substantially lowered year-on-year. For SME business, the growth is also curbed. This is a similar trend. Number two is about loans and deposits. For corporate, this trend was relatively stable. The growth was stable. Industries or parts that are most heavily impacted are retail business, mortgages, small and micro loans. Number three, it is affecting our net interest income. Two parts. The first part is because our credit structure is changing. From February, we are seeing that retail investments is dropping in terms of credit. Therefore, relatively high yield assets percentage in our entire asset book is dropping.
The second part is that, as you know, our interest rate is dropping. Therefore, the two parts of reasons combined has led to the impact on our net interest income. Fourthly, I would say intermediary income will also be affected. Credit cards and debit cards settlements business were affected, driving down net non-interest income of the two cards, credit cards and debit cards. In the meantime, the sales of complicated products, bond issuance, asset management projects, have been affected by the outbreak because it became hard to perform due diligence with the quarantine situation. The pace and progress were postponed. Number five, the most direct impact will be on asset quality. For credit card and retail loans, I would say both their repayment capacity and willing to repay are dropping.
For February, we see SME and mortgages having higher percentages falling into the category of collection and overdue category as well. These percentages are substantially higher than previous months. For CMB, there is a quite special thing we need to mention because 49% of our collection capacity, our collection team, were in Wuhan, and they cannot go back to work. This 49% or 45%, I would say they are the strongest team that brings back cash and brings back value of the non-performing assets. Therefore, our credit card business is most heavily hit, not just in the sense transaction volume is dropping. I would add in another thing is that for our overseas transaction volumes of credit cards, you know we are the number one in the market, is also dropping. While fee income coming from overseas transaction is the highest, we see the volume being cut by 50%.
Chinese cannot go overseas, and that is an impact on us. Transaction, overdraft, these are the parts of the credit card business that has been affected, together with collection. But of course, starting from March, we see situations improving. Our collection capacity is gradually restored. From internal data, we do see March performances return to normal standards. We have also other good news. Apart from the previous five parts of potential impacts, we have good news as well. Number one is that we do have advantages with online sales capacity and wealth management capacity, which are given with full play during the epidemic. Agency sales of funds and wealth management products rose substantially, which supported AUM of our retail business to grow steadily. Number two, our financial markets business were not affected by domestic fluctuations and overseas fluctuations. On the contrary, we have partially benefited from the situation.
Number one, I would like to talk about bond investment, because by second half of 2019, as we have increased investment and prolonged the tenures, therefore the entire margin and floating profit of our bond investment portfolio increased substantially. Number two, I will talk about FX and precious metal. We have taken two strategies. Number one, controlling quota, and number two, mix with options. Therefore, the current substantial fluctuations hasn't caused us to lose any money. We were actually profiting a little bit from the current situations. Number three, I would talk about our financial markets products under the system of risk aversion played a very good role to help our clients avoid the fluctuations. Transaction volumes picked up heavily. The final parts about financial markets or of the good news would be the fact that the net value of our wealth management products maintained approximately the same.
These are the positive sides that I have seen for today, and also their impact. Some were good, some were bad news. What about our measures going forward? Also five aspects. Number one, we need to stick to the One Body with Two Wings strategy and positioning. Under this outbreak, our positioning of One Body with Two Wings has given us room to think deeply. Have made us understand more clearly that this positioning is important for CMB. We have also realized we need to integrate One Body with Two Wings as an organic whole. We've done stress tests every year, but we have never done any stress test against an epidemic. This outbreak has taught us one thing. That is, in this year, the two wings could be an important factor to stabilize our performances this year. We're also thinking about one question.
Should we have a higher percentage of retail business? Because I know over the years, people like this. People like retail business. People say, though the banks with higher percentages of retail business, let's say, can resist better against fluctuations and therefore have better market evaluations. That doesn't necessarily say the higher percentages of retail banking will be better. Our contribution of the book is 55%, and our five-year plan is that the percentage should be risen to 60%. I believe this is appropriate, and with the current epidemic, even given this context, I do believe that figure was appropriate. The two wings. I'd like to talk about the two wings. If the two wings were not strong, the body cannot fly too far away. Let's talk about deposits. The two wings have brought huge contribution to our entire deposit book, which is less than 4.7 trillion.
Close to 2 trillion were attributed by the two wings, especially the low-cost part. Second, I'd like to talk about the two-wing support on products. Many of the products sold to retail comes from the two wings. Number three, in the era of big data, of internet, the access to acquire retail clients were actually amongst the client base of the two wings. With these considerations, this year, as we are trying to integrate the One Body with Two Wings as an organic whole, we will definitely spend more time. Second, I would like to talk about asset quality. I've talked about the short-term impacts as retail could be affected, especially about credit cards. As a matter of fact, as early as 2017, we have paid attention to the shared debt phenomenon, which could jeopardize asset quality of credit card business. We have taken measures as well.
That is to build a digital platform that links client information with that of wholesale, and with that of our subsidiary, Merchants Union Consumer Finance Company subsidiary, so as to make client portrait better. We're also, starting from 2017, making flexible adjustments to our approach regarding this business. We are seeing performances with newly acquired clients picking up. Despite you might have seen in our 2019 annual reports that our credit cards formation of NPL is increasing, but that was well within control under our model. From ROIC perspective, our credit cards ROIC was the highest. I would say the balance of risk and return is well coordinated in the business of credit cards. We have taken measures across the years regarding credit cards, and I would like to say these measures are effective.
This epidemic only pressed a pause button on our credit card business, which might affect us in the short run, but as the situation gradually eases, growth will be recovered. Please be reassured, you don't have to worry too much about our credit card business. Mortgage policy is kept the same. For good housing, for good clients, for good regions, we are okay with that. We talk about three goods. For SME business, we're not that concerned. Despite the substantial increase of NPL formation in February, there's still 90% of the business were well collateralized, and the discount ratio is somewhere around 50%. So I believe this year, under these circumstances, for those collaterals situated at Tier three or Tier four cities, we might need to tighten our controls on SME business. Number 3, you might care about our NIM.
One side of your concern would be the fact that our NIM was lowering quarter-on-quarter in last year. I would say that's a result of the balance as we actively manage liabilities and assets. Q1 NIM was very high. Our strategy is to keep and maintain our advantage. We don't necessarily need too high a NIM. That might not do us good, especially from client end. After the new policy of asset management business, our retail client have had more demands on higher yields. Therefore, we were introducing more structural products, large cities, to satisfy their demands. This part of the retail client base. So that is the support made by the two wings to the one body. Also, in terms of investment of assets, for Q1, retail is a bit higher.
For Q4, we see large amounts of retail assets, ABS credit cards being transferred out of the book, and hence we see a drop in NIM. That is a result of our active management of liabilities and assets. You can be reassured about this part. No need for much concern. For this year, our management of NIM, let us talk about it from asset end. Starting from second half of last year, as we witnessed the downward trend of market rates, we have increased longer-term investments of assets to 51.4%. Therefore, the tenor structure were improved. The tenor were prolonged regarding the repricing. Number three, for one to three years loans, we are encouraging branches to offer fixed rate loans.
On liability end, this year, for structured deposits for large cities, for these parts of high-cost liabilities, be it from percentages, be it from total amount, we will exercise rigorous control. For FI liabilities, for the liquidity we acquired from FI clients, you can see for China Merchants Bank, I remember the figure is CNY 3 trillion for corporate, CNY 1 trillion for retail, another one will be coming from FI clients. This part of the liabilities will be repriced, and the cost is expected to be well controlled as well. Overall speaking, regarding NIM, you should not have fantasies that CMB can outperform the market, avert the trend. What we can do is to keep our momentum, keep our advantage. That is feasible. The fourth opportunity will be about intermediary income. Six parts. Number one is wealth management. Number two, credit cards.
Growth rate might not be that strong this year, but we do expect steady growth. Number three, asset management. As our subsidiary is opening for business, we do expect intermediary income from our subsidiaries picking up. Number four, asset under custody. We are optimizing AUC structure. The total volume is number two in the industry, but income is only number four. If by optimization of AUC structure, we do expect to pick up in terms of AUC intermediary income, fee income. Number five, investment banking. As you know, bond investments, bond underwriting, correct me. Bond underwriting and also asset matchmaking business do have opportunities this year. Sixth will be about financial markets. These are the six parts of intermediary income where we see opportunities. Number five, for our strategy regarding assets investments. First of all, retail. Definitely this year's growth will be slower than last year for credit cards.
I mean credit cards. While for mortgage, the rate will be kept high. SME investments growth will be kept at a reasonable level. We need to meet requirements from across the sectors, also from ourselves. We need to make it sustainable as a business. For wholesale business, we do have adequate reserve of projects. Our investment in wholesale loans, we do have a lot of confidence for that, especially for new engine business. In terms of regions, we will focus on the Greater Bay Area and also the Yangtze River Delta region. We do have adequate reserve of projects. Very lastly, I would like to talk a bit about the fact that we have kept consistency in terms of our strategies over the years. As early as 2018 and 2019, we have mentioned these factors. Either internet, either disintermediation, either Light-operation Bank, either One Body with Two Wings.
We have kept our strategies consistent. Epidemic will affect us. Nevertheless, we will keep our stability. I would say the epidemic have do us good in terms of one thing. That is we have lost fantasy. Our strategies will be kept consistent. They have shown efficiency under the current circumstances. Thank you very much.
Next question, please.
Now let's welcome Mr. Wang from CICC.
Thank you management for this opportunity. I'm Victor Wang from CICC. Every year, I would look forward to meeting with management team, and every year I would learn a lot. This year, the most exhilarating part is the rise of dividend payout ratio from 30%- 33%. It's only a change of 3 percentage points, but I do see it's a directional change, especially given the fact that economic growth is slowing down and risks and challenges are rising. To increase dividend payout ratio, that will reflect the confidence of management and also improve returns of investors. My questions will be, what are your considerations behind this move? If in the future, as Chinese economy falls into the category of medium growth, do you see potential of further improving dividend payout ratio? For the management, how do you view the relationship between growth, market share, and shareholders returns? Thank you.
Thank you for the question. I will briefly cover your question. You see, this year, the board has decided to increase from 2018's 30% to this year's 33%, and that is as CNY 1.2 cash dividend, tax included per share. The major considerations are as follows. Number one, we need to keep our business sustainable. We need to make our growth healthy. That is one factor. Number two, we need to give consideration for capital adequacy ratios. Number three, if possible, we will try to strike a balance to improve returns for shareholders. We have long sticked to the policy that our dividend payout ratio should not be lower than 30%. We have kept that policy for several years, that is 30% dividend payout ratio. This year, after giving consideration to multiple factors, as I've mentioned above, we have made this decision, that is 33%.
You obviously care about the future. What would be the potential regarding dividend payout ratio? Will there be fundamental changes? I believe, number one, the company has to run sustainably in a healthy manner. Number two, we need to meet with regulatory requirements on our capital adequacies. Number three, as you can see, there are downward pressure on the macro economy, combining the effects of the epidemic and also the impact from the crude oil crisis with fluctuations of financial markets. Opinions are mixed. Some are saying it's already the time of financial crisis. Some are saying we are on the verge of financial crisis. Yesterday, the deputy governor of PBOC said it might be too early to determine this time as financial crisis. But still, we as a bank need to make preemptive plans.
We need to prepare for the worst, maximize our efforts to strive for the best results. We can make commitment right here. There is one thing for sure. Dividend payout ratio will not be lower than 30%. If the above three things, we can achieve good results, we would like to keep stability in terms of our payouts, and we will try hard to gradually raise our returns for shareholders. Thank you for the question.
Next question, please.
Let's welcome Gary from HSBC. Thank you for taking my question.
I'm Gary Lam from HSBC. Can you pose a question on net interest margin to better understand the key drivers for the change in second half 2019, as well as partly more detailed thinking on our forward-looking projections in 2020's margin trends? Particularly, I would like to better understand the situations on retail loan yield, which we saw a sharper decline of 42 basis points half-on-half. Had there been some one-off factors that impacted this margin, or shall we expect this trend to potentially continue into 2020? Also, I'd like to confirm whether it's correct that LPR reform should actually impact corporate loans more than retail loans. Thank you very much.
I'll take your first two questions. As I mentioned during the previous question regarding epidemic, I already covered. The third part of your question will be covered by EVP, Mr. Wang Liang.
I will answer the third part of your question regarding LPR's impact on the company's interest income. We have followed the rules of regulators. From last year incremental loans, we have followed the basis of LPR to price our loans. While for the transition of existing loans, we're performing it from March this year to end of August. This is the transition period. We have made public measures taken, and across the bank, I would say for the transition of existing loans, the size will be somewhere around CNY 1.8 trillion, of which CNY 1.05 trillion are mortgages, CNY 400 billion were wholesale loans, a bit over CNY 300 billion were non-mortgage retail loans. So that's the rough structure of the existing loan. Our major measure is to, I would say, a same price transfer measure. Therefore, interest rate won't be changed to a substantial amount.
The second measure is that for interest rate change, we perform an annual change perspective of measure. And certainly, about the term, from April 1st to August end, roughly half year's time, we will perform the transformation. These are the measures we have been taking. I would say the impact of LPR to the companies, overall speaking, and also in specific about net interest income, will be very minimal. It could be impacting a bit higher in the next year. That will be our expectation for this year. Thank you.
Okay. I will take the next question. Thank you. I am Shiran from Morgan Stanley. I would like to know something from the LPR. Indeed, it is about the bank's core competitiveness, especially under the current fluctuation of loan rate. What preparedness have CMB made for the transformation of LPR? What sectors will you take into consideration when it is regarding to LPR quotation and existing loan repricing? What are the changes happening during the detailed procedure, and what will technology contribute to the loan pricing?
I will take your question. Regarding the LPR reform, it is under the backdrop of Chinese interest rate marketization. It is an important measure taken by the government. It is a challenge for our risk pricing and risk management. CMB, targeting this reform, has prepared for many years.
Just as President Tian mentioned, the external four factors influencing the whole industry's development is the interest rate marketization. Overall, we will gradually lower the asset size proportion of sensitive ratio assets. Overall, we have made thorough preparedness. The next step, targeting LPR's advancement, we will take the following measures. First of all, choosing our clients. We will select clients that are loan tenure risk pricing that can cover all customer base to enhance our customers' RORC level. Second, along with the decreasing of loan rate, this is guided by the policy and also contributing to real economy. Under these circumstances, our pricing level will also follow the principle and guidance brought by the LPR. We will increase customers' comprehensive return, including cross-selling and other return from some other products.
Along with the enhance of the bank's interest rate risk, how to manage the risk is also a challenge in front of us. We will conduct derivatives, options, futures, and other financial derivatives to cope with the interest rates risk. Basically, we will generally and gradually adapt to such a reform and remain a reasonable NIM and a stable growth of our net interest income.
Please introduce the next question.
The next question comes from Li. Ms. Li from BOCI Securities.
Dear senior management. I think in people's mind, CMB has always been a bank that keep abreast of time. In 2020, no matter macro economy or the pandemic, Chinese economy are experiencing great changes. I would like to know from Chairman Li or President Tian about your business positioning, for instance. With the further advancement of the interest rate marketization, which type of business do you think CMB want to explore the most? Just now, President Tian have also introduced that it is the financial market business that under the pandemic will be a new area that we would like to explore. I would like to know what type of business would you like to explore the most. Under the 2020 year's backdrop with an even more eased fiscal policy, will CMB consider to shift some of the resources from retail to corporate, such as infrastructure construction?
President Tian also mentioned that 60% of the retail resource proportion would be reasonable. This year, I would like to know whether you have any thinking or arrangement over the other resources allocation. Another question is the trend of de-banking of the younger generation of our clients. Previously, we can see CMB doing promotion of the credit card and debit card in colleges. Will you consider to shift the key customer base of the retail business to the middle class with more middle-aged people? These are my questions.
The Shenzhen office will take this question.
Wow, that's really a bunch of questions. I will get it through. About the retail and corporate business. Overall speaking, our consideration is, as I just explained, we will follow the One Body with Two Wings positioning. We will keep persisting this strategy, especially the one body, and we will enhance our philosophy of forming into an organic body. About this year's asset investment under such circumstances. To finish this year's asset investment plan in terms of our structure, the retail growth rate would definitely be less than that of last year. But for detailed information, we will act accordingly according to the market. But our overall strategy will remain stable. For your second question, retail customer base, especially the young customers, has always been a focus of CMB. For the high-net value clients, for wealth management clients, for young clients, these are all customer base we will cover.
It is no such saying that we pay special attention to just young people. We will further complete our mechanism to provide better services to clients.
Next questions will come from Shenwan Hongyuan Securities, Mr. Ma.
Thank you for giving me this opportunity. Dear investors, I have two questions. The first is about revenue and risk appetite. This question has been raised in the recent annual result announcements. I think from your performance, the revenue growth rate is relatively moderate compared with your fast profit growth rate. Is it, to some extent, an active action taken by CMB? Is it possible that I regard future CMB will remain a relatively low-risk appetite and a moderate revenue growth and a fast profit growth? In all, moderate revenue growth, good asset quality, and fast profit growth. The second question is about asset management business. Since the launch of new regulation of asset management, CMB has been putting itself under great pressure of the transformation. I can also see the results of your transformation.
To see from your annual report, I can see quite positive prospect and outlook for the scale of asset management business. I would like to know from the senior management that when did you expect that the income from asset management business can significantly increase, and what's the appropriate amount of contribution made by the asset management business income? And what is the appropriate ratio of off-sheet and on-sheet balance assets?
These questions will be taken by the Shenzhen office.
To answer your question one, the investors' analysis are all concerned about CMB's revenue growth, which is quite moderate and slower than that of the profit. This is what the senior management has attached great importance to, and we strive to solve this problem. Through our analysis, for the past three years, our comprehensive return has recorded good. For the past three years, we have recorded revenue growth of 5.3%, 12.4%, and 8.8%, so in average, total 9%. Generally speaking, we still rank among the top in terms of the revenue growth. There might be some fluctuation, but the fluctuation itself is closely related to the external factors. We also reflect on ourselves, our development path, and pattern.
If we pursue high revenue growth, it might also bring us with high level of risk. The result might also be low profit growth. So either the speed or quality, you have to make a choice. Another possibility is low growth, low level of risk. It might also made us achieve good profit growth. I think for CMB within this pattern, we have made our minds to achieve a moderate growth of revenue. It could be regarded as a medium to high speed of growth. This pace made us more comfortable and more confident to select our clients, select our business. If we want to pursue a higher growth of revenue, we might be faced with higher risk. It might also lead to higher allowance. So I think a medium to high speed revenue growth is within our risk appetite and also bring us with higher profit growth.
It is in line and wise choice against the backdrop of the economic downturn. This year, we will still be faced with similar questions, how to further increase our revenue growth and how to better control our risk to maintain our profit growth under current circumstances. I believe our practice and our methodology fit into our shareholders, our investors' benefits. That is so much of my answer. I will make some other response. Revenue growth comes from two factors. Asset scales enlarge and also fee incomes increase. If we assume fee and commission income as an exposure, I believe one of the variable is the RWA. We would regard and discuss RWA from two factors, customer needs and market environments. For instance, this year, the market environment is very special. Of course, another factor is CMB's risk management capability. Secondly, CMB's unique characteristic, our Light-operation Bank strategy.
What is Light-operation Bank? Light asset, light management, light culture. Actually, analysts care most about light balance sheet, light assets. It is all about the indigenous capability of the capital. For the past seven years, we never done common shared issuance. According to our capital planning, in the future five years, there is no need to do so. When we are thinking about revenue, these should all be factors that be taken into consideration. You cannot fantasize that high revenue, high profit can both be achieved under such economic backdrop. The time has gone. China's economic growth has shifted from high speed to moderate to high speed. According to President Xi, we are faced with the most challenging environment over a century. This is not just about an indicator. These are all relevant, all integrated into together. To remain RWA setting, we will take two factors into consideration.
First, customer needs, market environment, and risk management. The second is about our Light-operation Bank strategy, which is demonstrated in our business growth. How do we make our strategy of Light-operation Bank into indicators? That is light assets and our capital indigenous capability, and to provide higher dividend payout ratio to our shareholders.
Thank you for your question. For asset management, I think for this business, you may would like to know the income contributed by this business. In 2019, the fee income was recorded as CNY 56.5 billion, down by 14%. The major reason is, first, the high yield assets, especially the non-standardized credit assets, are insufficiently invested. In the year 2018, a large amount of them matured. But in the year 2019, there is a phenomenon of insufficient investment, so the income is influenced. Another strategy, after the establishment of CMBWM, we have a new purpose.
After the establishment in November, our development process is very stable and healthy. We have launched a new product and have recorded a product scale of CNY 860 billion . We have also been developing steadily amongst our other goals. We also ranked second among non-guaranteed WMP in 2019, amounting to CNY 2.16 trillion . When we are thinking about the transformation, we are talking about the strategy. Within CMB's strategy, just as introduced by President Tian, we are under the backdrop of opening up and integration. Wealth management business is actually a business that serves as a bridge connecting investment business, asset management, custody business, and many other business. It is a very important component serving the One Body with Two Wings strategy.
We would like to give our role into full play to further develop the One Body with Two Wings, and better serve our clients and satisfy their wealth management needs. We will definitely make the balance sheet of wealth management at CMBWM bigger. The intermediary fee income is a natural result along with our development. In 2020, the fee income will definitely witness increase. It is also our confidence in our overall scale under management. We will keep enhancing our capability, risk management capability, systematic capability to further enlarge our scale.
Thank you.
Let us welcome another analyst and investors question, and move on to the media session. Please.
Thank you. Now, let us welcome Mr. Liu from Rongtong Fund .
Thank you, management. I am Liu Ankun, covering Fintech. The tool applications MAU has surpassed CNY 1 trillion , which is similar to Bilibili. I would prefer it as an individual ecosystem rather than a supporting role of traditional bank. I would like to know your investment and return ratio. Will it further focus on enlarging your customer base or to enhance or increase the customer using time or activity? I think from your disclosed data, there are still room to grow regarding the average login times. The second question is about the applications product metrics. Our vision is to connect hundreds of millions or even more people of their life scenarios. It is actually forming a competitive landscape with other internet companies such as Alipay. For the long run, I would like to know from your strategy, how will you adjust your product metrics? Basically these are my two questions.
The questions will be taken by our attendants from Shenzhen.
Last year, our MAU has achieved 102 million. This is a result of our further advancement of Fintech strategy. Since this year, our focus may shift from the original of quantity to both quality and quantity. For specific measures taken, as you have noticed, we will extend the boundaries of service. Clients users will serve as the inner ring, middle ring, and outer ring of our landscape. In transforming users into clients, we still need to increase our efficiency. This year will be one of our major focus and will also be invested with further resources and funds. We have already recorded and accumulate 38 million users within the middle ring. In terms of our core service capability, we have to admit that we are still falling behind our expectation. For the first question, this will be the minor adjustment to our strategy.
The second questions will be taken by our Chief Information Officer, Jiang Chaoyang.
I will take the second question. It's about the application or MAU's long-term strategy. Frankly speaking, our positioning is very clear. We are a financial application. The first strategy is to keep enhancing and strengthening our financial self-scenario capability. This year, regarding cash flow management and wealth management, we will further enhance these services within the application. I think these are the most attractive scenarios to our clients. These are also very important functions. During the pandemic, the traffic are greatly limited, but wealth management traffics are not that influenced. It inspired us to further enhance our financial service capability within the application. In our infrastructure construction, we will follow the path of meeting clients' needs and make further extensions, extending to their life scenarios, non-financial scenarios, to build four plus one scenarios.
Meal ticket, movie ticket, public transportation, handy services, and the plus one can be selected according to different situations in individual cities. We can start from financial scenarios and extend to life scenarios which can surround our clients. This is an integration and combination of financial and non-financial scenarios. The second is about online and offline integration. Today, banks' advantage is for CMB, we have 1,800 and more outlets around the nation. It is influential to the communities around the outlets. We will further combine our capability offline and online so that customers can be better connected and reached both from the two channels. This is the second thing we will do. Actually, we have done some attempts before. Just now, President Tian has announced our results, especially mentioned that 1,400 of our outlets have established online store, which means that these outlets can operate and maintain their customer relationship online.
Further on, we will divide special column for these outlets and further provide support to them. For instance, relationship managers can connect and communicate with their clients online, and the coverage ratio of the relationship managers has increased to 101%. This year, we will further support RM outlets branches to better support their clients online. This is the integration of online and offline I mentioned. The third integration is about client operation can be further client-oriented in terms of comprehensive financial service. I think application is naturally client-oriented and client-centered. We will further transform our methodology of previously product-oriented into client-oriented. It is the integration of surrounding our client to provide comprehensive service. These are the three integration of our future application development.
Thank you. Let's now move on to the media session.
In order to have more friends asking questions, please limit your questions one person at one time. Please also identify yourself and your agency before you raise a question. Now let's welcome the first question. Now let's welcome Mr. Liu from Shanghai Securities.
Management, thank you. I'd like to raise a question about CMB's private banking business. We see the account average assets has been dropping for two consecutive years, and this year it is the drop of CNY 600,000 . Not big, but still, that's a trend. I would like to see your opinions regarding this trend, and now that you have a new general manager heading up the private banking sector, what will be your new tactics? We see BOC putting private banking with internet finance. We see Ping An Insurance is trying to build a Fintech or technology-based private banking business.
Our Shenzhen office will take this question. Thank you for this question.
For private banking business, we do have a new head. I don't see any abrupt change. After all, it's not the change of our President. Our strategy is consistent. In the last year, I would say the overall performance for private banking is good. Growth year-on-year was quite substantial. For this year's beginning, we also kept a good momentum. We have mentioned the impacts of the epidemic. When we look back at our structure of client base, the higher end of our clients are less affected by the epidemic. You talked about the trend of dropping in terms of our per account average assets. That's very normal because we have kept a very high growth of client base. Because the number of clients have increased higher than the size of assets, therefore, the average assets per account has dropped. That's only natural.
For private banking business, we will follow the set paths. The only place for change could be in the fact that starting from this year, regarding overseas private banking business and also in the field of digital private banking business, we will strike ahead.
That will be my question. Thank you.
Next question, please.
The next question will be coming from the 21st Century Business Herald, Mr. Jizhao.
Thank you, management. I am Xin Jizhao from the 21st Century Business Herald. My question is about asset quality. This year is different because during the epidemic and also combined with the pressure of the downward economic trend. For the management team, what do you think that might face bigger pressure, wholesale business or retail business? What are the specified sectors? Any updates on pressure tests? What are the results if it's wholesale business? If it's retail that you think that might suffer bigger impacts, I see from Q4 of last year's new issuance volume of credit card business is dropping, which is quite rare. What do you expect about future performances of asset quality in credit cards? Are there any set trends? Any change of directions?
Another thing is that now that market rate is dropping, what do you see as the pressure on your liability cost and any results from pressure tests? Because we do see structured deposits is picking up cost and taking up more shares.
I'll answer your question regarding asset quality. For 2019, overall asset quality were steadily improving. Both balances and ratios dropped. But still, we can see there are exceedingly good parts. There are also parts we need to pay attention to, and that is an incremental amount of more than CNY 8.9 billion in 2019 in comparison with 2018, altogether reaching more than CNY 40 billion . A part of the CNY 40 billion NPLs, CNY 8 billion comes from credit cards. For management strategies on credit card business, let's talk about client acquisition. Let's talk about investment. We have already shrank investments because we need to take into consideration the shared debt risks. We are taking a rather prudent credit policy regarding credit card. Despite the policies taken, we also need to release more of the exposures. These are all within our expectations.
For this year, even without the epidemic, I would say we are confident to keep the credit card business grow at a steady level. Now that we have the epidemic, there could be some impact, and the overall risk might rise. You have mentioned several parts of the picture, be it from wholesale or be it from retail. Let's start from wholesale. Overall speaking, asset quality remains stable. While for retail, their assets could be more heavily impacted. President Tian has introduced in details. I won't waste your time. Wholesale has remained stable. Despite this fact, we will remain very cautious, and we need to pay special attention that some certain industries have saw rising amount of risks, mostly wholesale industries. Also some parts of the retail as well. Regional wise, we see the improvement in the Yangtze River Delta region, but still risks associated in northeastern parts of China is rising.
We are also seeing some major accounts with risks involving case of bond default, pushing up the overall non-performing loans and risks. So the changes in risk situations of different regions must be taken into consideration. We also mentioned retail loans. Despite the impact of the epidemic, as we can see, there are a rise of non-performing loan cases with retail, but still with mortgages, the overall collateral rate is somewhere around 39%. The discount rate is somewhere around 39%, which is quite enough. While for SME loans, they are mostly collateralized. Therefore, despite the rise of NPL formations, the actual loss will be kept at a minimum level. We are well aware of this. In recent years, we have rigorously performed classification standards and truthfully reveal default cases. The share of NPL with those overdue for more than 90 days was 1.18, demonstrating our rigorous classification.
We are also constantly raising our loan provision charges. By the end of last year, it is well over 430% regarding NPL provision coverage. We are very confident despite the impact of the epidemic, although there could be some certain cases in certain industries, but we, in general, can sustain the impact and kept a relatively good asset quality. That would be my answer for your asset quality. I missed your second part of the question. I beg your pardon.
Talking about market rates going down. The influences of market rates going down on deposits. For PBOC, the money market rate is lowering as liquidity is pouring into the market. Another thing is that with the introduction of LPR regime, February 20th, we see the drop of LPR by 5- 10 basis points for one year and three years. There are also speculations in the market whether PBOC will go on to further lowering the benchmark rate. Right now, as you can see, the Fed from the United States has lowered the rate to zero at one stop, giving us quite a good room. But domestically, CPI is closely relevant with the epidemic, and last month, it was 5.2%, quite high. Therefore, whether to lower deposit rate still remains a question to watch and need to take time to consider.
But still, deposit rates will be kept at a reasonably stable level to maintain a good NIM and register positive growth of interest income. I would like to see it happen. But whether rate cuts will boost growth of deposit, it would be hard to say. It is dependent on your client structure, on your sources of liabilities. These factors will determine whether you can sustain your market share in the current situation.
Okay. Let's welcome the next question. As today's attendance was quite crowded, please limit your question to one at one time.
Next question comes from Mr. Ma from Securities Times.
Dear senior management, I am journalist Ma from Securities Times. In our annual report, it is expected that our NIM is under pressure. I would like to know from the senior management of your asset management and liability management strategy.
This question will be taken by the attendance from Shenzhen.
Just now, President Tian is actually answering this question during his response to the pandemic relevant question. I think this year, CMB's asset liability arrangement will be similar to last year's, remain stable growth rate. Last year, the asset liability level was around 10%. We will remain a relatively stable growth. In the asset side, like last year, we will fit into the One Body with Two Wings strategy. Regarding the one body, we will invest more in Retail credit, including residential mortgage and small and micro-sized loans. For corporate, our loans will incline to remain a stable growth and invest into strategic customer on head office and branch level, and focus more on developed region and areas as SMEs. For industries, we will focus on infrastructure construction, industries with new growth driver, high-end manufacturing, and other top-tier enterprises within their industries.
We will select the best clients among the best to guarantee RWA growth within the appropriate arrangement, and guarantee to optimize the asset liability structure. For the liability side, it is highly dependent on the quality of our deposit. The growth of liability would also be similar to the same level of last year, close to 10%. Under the M2 growth, in order to increase CMB's market share, on the basis of M2, we will add two more basis percentage point. We will also enhance our management of the growth of core deposit.
This is our shareholders', investors' analysis confidence over CMB's control of our low-cost funding and also our NIM. We will also enhance our quota management and pricing management to further enhance the liability quality and our market competitiveness to maintain the liability business growth within appropriate speed.
We will reasonably delay our Q&A session. Because of your enthusiasm, I will have the last two questions from our media friends.
The next question comes from Reporter Hu Yang from the China Banking and Insurance News.
Dear management, just now, EAP, Liu Hui, has also mentioned about the asset management business. I would like to know about the migration problems within the head office asset management department and the CMBWM. Second question is about after the pandemic, what will the asset management business of CMBWM be affected by the pandemic?
Thank you for your question. First is about the relationship between the head office department and CMBWM. There will be a parallel running period. We are still within the period, so the asset management department within head office is coexisting with the CMBWM subsidiary. Product issued in the name of head office is under management of the asset management department. For the subsidiary, they have also issued new products. For the existing asset and existing product, they are managed by the department. The second question, I beg your pardon about the second question. Oh, it's about pandemic. Just now, President Tian has also mentioned in his previous response. My response can be divided into favorable and unfavorable aspects. For the impact side, it's from the asset we can see the overall Chinese economy has been paused because of the pandemic. We cannot reach out to our clients.
So in the investment of non-standardized assets, we are under great influence. We basically stopped the investment of non-standardized assets in February, but things are getting normal right now. Under the crisis model, assets and the yields both decline. It has put our bond investments and reinvestment under great pressure. For favorable condition, we have demonstrated our strong capability of online management, especially our online launching of products. The sales have not been influenced at all. On the contrary, investors are more inclined to regard CMBWM's product as a very stable one. We have witnessed very hot sales during the pandemic period of our newly launched online product.
I will have the last question from our media friends.
The last question comes from Ms. Yen from Southern Metropolis Daily.
Dear senior management, I would like to know for the asset quality, especially the real estate non-performing assets, has declined by 59 percentage points. In suppressing the non-performing assets in real estate, what measures have you taken? What is this year's strategy regarding real estate loan?
This question will be taken by attendees from Shenzhen.
To answer your question, our real estate loan existing NPL is very limited, around CNY 2 billion. The real estate industry's non-performing ratio accounts for a really small proportion over our book, and could be regarded as a quality asset. Around CNY 200 billion assets, the non-performing asset accounts for only CNY 2 billion, so it is really a small proportion of it. For real estate loan, CMB has always maintained a very prudent and steady principle. We have conducted quota management. In our year beginning plan, we always conduct total amount control and quota control over real estate.
We also conduct name list management over commercial real estate loan. We have established strategic partnership with some top-tier clients within our name list. Thirdly, in choosing the region, we will select Tier one and Tier two city. These are cities that have high demand of housing needs, and these will be the areas we invest the most. The real estate business types, we will focus on satisfying the personal use of the houses, which can, to the large extent, lower the risk level. So basically, these are the measures we take on the real estate loan, so that we can maintain a reasonable growth over this type of loan. We can maintain an appropriate amount of loan granted and a very healthy risk level of control. In this year, we will keep pursuing our strategy as always to further deliver real estate business to our customers.
Due to time limit, the 2019 CMB result announcement will conclude. I know clearly that you still have many questions to know from the senior management, and our senior management also would like to communicate with you to the largest extent. If you would like to know more about our detailed information, you may refer to our annual report. For other questions, we also welcome you to discuss with our investor relations team. To be a very transparent CMB in front of our investors is our goal. It will still be our principle as always. Thank you again for joining us. CMB will continue to do our best to deliver better returns to our investors and shareholders. Thank you.
Thank you.