Another consumer finance company has met the 10 billion yuan registered capital requirement.

On June 22, JINSHANG BANK (HKG: 2558) announced on the Hong Kong Stock Exchange that it had signed a share subscription agreement with Jinshang Consumer Finance Co., Ltd. on June 18. The bank will subscribe for 500 million new shares in Jinshang Consumer Finance for a total consideration of 730 million yuan.

Upon completion of the transaction, Jinshang Consumer Finance's registered capital will increase from 500 million yuan to 1 billion yuan. JINSHANG BANK's shareholding will rise from 40% to 70%, making the consumer finance unit a subsidiary to be consolidated into the bank's financial statements.

This 730 million yuan capital injection marks the first capital increase for Jinshang Consumer Finance since its establishment a decade ago. It also represents the company's successful "remedial exam" to comply with the "Measures for the Administration of Consumer Finance Companies," implemented two years prior. If approved by regulators, only two licensed consumer finance firms—Mengshang Consumer Finance (5 billion yuan) and Shengyin Consumer Finance (3 billion yuan)—will remain below the capital threshold among the 31 licensed players.

First Capital Raise in a Decade Meets Dual Requirements

Jinshang Consumer Finance was established in February 2016. It is the only institution in Shanxi province holding a nationwide consumer finance license. It was jointly funded by JINSHANG BANK, Shanghai Rongda Investment Management Co., Ltd., Tianjin Yucheng Technology Co., Ltd., Shanxi Huayu Commercial Development Co., Ltd., and Shanxi Meetall Chain Supermarket Co., Ltd.

The urgency for the capital increase stems from the "Measures for the Administration of Consumer Finance Companies," which took effect in April 2024. The new regulations explicitly raise the minimum registered capital requirement for consumer finance companies to no less than 10 billion yuan and require the main contributor to hold no less than 50% of the shares. Prior to the increase, Jinshang Consumer Finance had a registered capital of 500 million yuan, and its largest shareholder, JINSHANG BANK, held a 40% stake, failing to meet both requirements.

This capital increase plan directly addresses these two core issues. Regarding registered capital, it rises from 5 billion to 10 billion yuan, precisely meeting the regulatory threshold. In terms of shareholding structure, JINSHANG BANK's stake jumps from 40% to 70%. The holdings of the other four shareholders are diluted to 12.5% (Shanghai Rongda Investment), 10% (Tianjin Yucheng Technology), 4% (Shanxi Huayu Commercial), and 3.5% (Shanxi Meetall Chain Supermarket), respectively. JINSHANG BANK will pay the entire 730 million yuan consideration in one lump sum, sourced from the bank's internal resources.

In its announcement, JINSHANG BANK stated that this capital injection will help expand the business scope and customer base of the consumer finance unit and optimize the overall financial services layout.

The transaction is still subject to written approval from the Shanxi Supervision Bureau of the National Financial Regulatory Administration regarding the change in registered capital and equity structure adjustment. If approval is not granted, Jinshang Consumer Finance must refund the subscription price plus interest calculated based on the Loan Prime Rate published by the National Interbank Funding Center.

In fact, as early as November 2020, Jinshang Consumer Finance had listed a capital increase plan on the Shanxi Property Rights Exchange Center, aiming to raise up to 740 million yuan at an assessed price of 1.48 yuan per share. At that time, JINSHANG BANK planned to participate proportionally, maintaining its 40% stake post-increase. However, that plan was ultimately shelved. Five years later, the subscription price this time is almost identical to the assessed price from five years ago. However, JINSHANG BANK is shouldering the entire capital increase alone, pushing its stake to 70%. This move is driven by both regulatory pressure and the bank's reassessment of the strategic value of the consumer finance license.

Volatile Performance and Persistent Compliance Issues

Behind this remedial capital increase lies Jinshang Consumer Finance's less-than-optimistic performance trajectory in recent years.

In 2021, the company achieved a net profit of approximately 61 million yuan, a recent high. Performance began to weaken in 2022, with annual net profit around 52 million yuan, a 15% year-on-year decline. It hit a low in 2023, with net profit plunging 42% year-on-year to only about 30 million yuan, even recording a loss of nearly 9.8 million yuan in the second half. A strong recovery followed in 2024, with net profit rebounding to 66 million yuan, a surge of about 116% year-on-year. This rebound was primarily driven by rapid asset expansion: by the end of 2024, total assets exceeded the 10 billion yuan mark, reaching 10.831 billion yuan, a 21% increase year-on-year. The loan balance also surpassed 10.8 billion yuan, up 27.6% year-on-year.

However, this growth momentum came to an abrupt halt in 2025. Based on JINSHANG BANK's annual report, Jinshang Consumer Finance achieved a net profit of approximately 40 million yuan for the full year 2025, a sharp 38.2% decline from the 66 million yuan in 2024. Looking at the intra-year trend, it achieved a net profit of 32.73 million yuan in the first half, roughly flat with the same period in 2024. However, net profit in the second half was only about 7.9 million yuan, a significant sequential drop of about 76%. The sharp contraction in quarterly profit directly dragged down the full-year performance.

Entering 2026, Jinshang Consumer Finance reported revenue of 276.5 million yuan and a net profit of 5.5 million yuan for the first five months, already exceeding the full-year 2025 net profit. As of May 31, 2026, its audited net asset value was approximately 970 million yuan.

Since 2025, Jinshang Consumer Finance has also undergone changes in senior management. In October 2025, Shangguan Yu Jiang officially resigned as chairman, and the company has not yet appointed a new chairman. In September 2025, the appointment of Zhao Chongping as president was approved.

Regarding products, Jinshang Consumer Finance's main offerings currently include "Jie Wa" and "Jin Qing Dai." "Jie Wa" is an online product with a maximum credit line of 200,000 yuan and a term of up to 36 months. The offline "Jin Qing Dai" provides credit loans of the same amount to individuals with stable incomes.

Beyond performance pressure, Jinshang Consumer Finance's compliance record also warrants attention.

Years ago, the company made headlines on social media for using insulting language in a personal credit report, leading to a public apology on its official website.

Subsequently, on April 8 and May 25, 2021, the Taiyuan Central Branch of the People's Bank of China summoned and interviewed responsible persons from Jinshang Consumer Finance. In 2019, the company was ordered to make corrections within a time limit and fined 500,000 yuan for violating relevant provisions of the "Regulations on the Administration of Credit Investigation." The directly responsible person was also fined 50,000 yuan. In March 2022, Jinshang Consumer Finance was fined another 490,000 yuan for failing to provide written replies to异议人 regarding异议 handling results and for inaccurately reporting personal credit information, with the responsible executive also penalized.

In December 2025, information from the China Enforcement Information Disclosure website showed that Jinshang Consumer Finance became an enforcement target. The case was filed by the Suizhong County People's Court in Huludao City, Liaoning Province, on December 10, 2025, with an enforcement target amount of 20,000 yuan.

On a consumer complaint platform, there are over 3,800 complaints related to Jinshang Consumer Finance, primarily concerning improper debt collection, privacy leaks, excessive guarantee fees, and interest rates exceeding legal limits.

Furthermore, among its four independent shareholders, Shanxi Meetall is a失信被执行人 (discredited entity subject to enforcement).

For JINSHANG BANK, this substantial 730 million yuan investment in its consumer finance subsidiary comes against the backdrop of its own operational pressures.

In 2025, JINSHANG BANK reported operating income of 5.445 billion yuan, a 6% year-on-year decline. Net profit attributable to the parent was 1.665 billion yuan, down 5.1% year-on-year. Both revenue and net profit have declined for two consecutive years. In 2024, the bank's revenue decreased by 0.2% year-on-year, while net profit fell by 12.6% year-on-year, marking the first simultaneous decline in net profit and net profit attributable to the parent since its listing in 2019. Concurrently, the bank's non-performing loan ratio rose to 1.95% in 2025, the highest level in nearly five years.

The Final Two Laggards: Mengshang and Shengyin

Following the capital increases by Jinshang Consumer Finance and several other institutions, including BOB-CFC, Jimei Credit, Haier Consumer Finance, Suning Bank-KGI Consumer Finance, Xiaomi Consumer Finance, Changyin Wuba Consumer Finance, and Harbin Bank Consumer Finance, only Mengshang and Shengyin remain as the two non-compliant institutions.

Mengshang Consumer Finance, formerly Baoyin Consumer Finance, was established in December 2016 with a registered capital of 5 billion yuan. Its shareholders include Mengshang Bank (44.16%), Weimeng Chuangke Network Technology (40%), and Shenzhen Samoyed Internet Technology (15.6%). It similarly faces a compliance gap as its largest shareholder holds less than 50%. In terms of performance, Mengshang Consumer Finance reported operating revenue of 668 million yuan in 2025, a 37.45% year-on-year increase, and net profit of 23.38 million yuan, a surge of 926.34% year-on-year. However, behind this rebound from a low base is the reality that the company has long been at the bottom of the industry—its net profit plummeted to 2.278 million yuan in 2024, a 91.89% year-on-year decline.

As the first licensed consumer finance institution in Northeast China, Shengyin Consumer Finance was also established in February 2016, but with a registered capital of only 3 billion yuan, the lowest among all licensed consumer finance companies. Its largest shareholder, Shengyin Bank, holds a 75% stake, which already meets the regulatory requirement for shareholding percentage. However, the 3 billion yuan capital base still falls 7 billion yuan short of the 10 billion yuan threshold. In 2025, Shengyin Consumer Finance achieved operating revenue of 534 million yuan, an 82.50% year-on-year increase, and net profit of 96 million yuan, up 10.95% year-on-year.

However, Shengyin Bank has been under operational pressure in recent years and has not yet released its full-year 2025 results. In 2024, its revenue decreased by 14.6% year-on-year, and net profit fell by 15.9% year-on-year. In the first half of 2025, Shengyin Bank's performance continued to decline, with operating revenue of 4.326 billion yuan (down 5.1% year-on-year), net profit of 508 million yuan (down 14.1% year-on-year), and net profit attributable to the parent of 494 million yuan (down 14.4% year-on-year). This casts uncertainty over the prospects for a capital increase at Shengyin Consumer Finance.