The first provincial-level rural commercial bank of the year has arrived! Gansu Rural Commercial Bank has officially been established with a registered capital of 44.9 billion yuan.

Everyday Economic Reporter | Liu Jukai Everyday Economic Editor | Bi Luming

On March 17, Tianyancha’s business registration information showed that Gansu Rural Commercial Bank Co., Ltd. was officially established on that day. The legal representative is Wang Wenyong, with a registered capital of 44.92 billion RMB. Its business scope covers all types of banking services.

Image source: Tianyancha

The establishment of the bank marks a key progress in the reform of rural credit in Gansu Province. According to administrative licensing information released by the China Banking and Insurance Regulatory Commission on February 9, the bank was approved for preparatory work, becoming the first provincial-level “unified legal entity” rural commercial bank approved for construction nationwide in 2026.

Shareholder information shows that the bank is jointly held by Gansu State-owned Assets Investment Group Co., Ltd., Gansu Energy Chemical Investment Group Co., Ltd., Gansu Highway Transportation Construction Group Co., Ltd., Jiuquan Iron & Steel (Group) Co., Ltd., and other provincial state-owned enterprises. Industry insiders close to small and medium-sized bank reforms note that this shareholder structure clearly features “provincial state-owned capital dominance and integration of industry and finance,” reflecting the strong support of local governments for rural credit reform and providing solid guarantees for the bank’s stable operation.

Image source: Tianyancha

From “Joint” to “Unified”: A Multi-year Strategic Shift

Gansu’s rural credit reform path has experienced a clear transition from “joint banks” to “unified legal entities.”

Tracing the reform history, the 2023 Gansu Provincial Government Work Report explicitly proposed “prudently promote rural credit cooperative reform and establish Gansu Rural Commercial Bank,” favoring a secondary legal entity system that retains county-level legal status. This model is similar to the choices of eastern developed provinces like Zhejiang and Jiangsu, aiming to coordinate resources through a provincial platform while maintaining flexibility at the county level.

However, in the following two years, references to “joint banks” quietly disappeared from government work reports. In 2024, the reform focus shifted to “prudently advancing rural cooperative institution reform and accelerating the resolution of historical issues in small and medium-sized financial institutions”; in 2025, the focus further shifted to “gradually advancing bad asset recovery and disposal, and completing the exit of high-risk institutions.” By August 2025, shareholders’ meetings of Jinchang Rural Commercial Bank and Yongchang Rural Commercial Bank approved the establishment of Gansu Rural Commercial Bank, signaling the gradual implementation of the reform’s strategic shift.

The 2026 Gansu Provincial Government Work Report ultimately clarified that “consolidating the results of small and medium-sized financial institution reform and establishing and operating Gansu Rural Commercial Bank” was a key annual task, marking a clear transition from “joint banks” to a “unified legal entity” provincial rural commercial bank.

Industry experts close to small and medium-sized bank reforms point out that this switch reflects the precise application of the “one province, one policy” principle in rural credit reform. For provinces like Gansu, with many legal entities but some “small, scattered, and weak,” the “unified legal entity” model can maximize financial resource integration, create scale advantages, and enhance overall capital strength and risk resistance.

The expert further explains, “While the ‘joint bank’ model retains flexibility at the grassroots level, it cannot fundamentally solve systemic governance issues. The ‘unified legal entity’ model, by consolidating 83 legal institutions into a single entity, allows for comprehensive capital restructuring across the province, breaking county-level barriers, and focusing resources on disposing of historical bad assets.”

Risk Resolution First: 42.6 Billion RMB in Special Bonds Pave the Way for Reform

The deeper reason for choosing the “unified legal entity” model lies in Gansu’s unique historical background in its rural credit system and the phased achievements in risk disposal. As the main force serving agriculture, small micro enterprises, and county economies, Gansu’s rural credit system is substantial but structurally dispersed. Public data shows that the system currently includes 37 rural commercial banks, 5 rural cooperative banks, 41 county-level federations, over 21,000 employees, nearly 1,904 business outlets, 4,582 convenience financial service points, and benefit service terminals, with business extending throughout urban and rural areas.

However, due to local economic foundations and industrial structures, asset quality varies widely within the system, and historical burdens are relatively heavy. From 2019 to 2021, the non-performing loan ratio of Gansu’s banking institutions remained above 6% for three consecutive years, with some county-level rural credit institutions facing prominent risks. To resolve risks and replenish capital, Gansu issued a total of 42.6 billion RMB in special bonds supporting small and medium-sized banks in 2021 and 2022, aimed at capital supplementation for 58 rural cooperative institutions and provincial federations.

Through continuous efforts, phased risk resolution has achieved results. By the third quarter of 2025, the province’s banking non-performing loan ratio had fallen to 2.40%, with non-performing loan balances down 60% from peak levels, reaching the lowest in five years. This “risk first, reform later” cautious approach laid a foundation for a more thorough reform model.

Industry analysts believe that Gansu’s choice of the “unified legal entity” model can be summarized as: “The ‘joint bank’ is no longer sufficient to address deep-seated contradictions; only ‘unification’ can break the deadlock.” They point out that under the “joint bank” model, county institutions remain independent legal entities with clear risk isolation mechanisms. In extreme cases, if a few rural commercial banks face operational crises, the provincial federation can only coordinate rescue efforts but cannot directly use the capital of other profitable institutions to fill gaps. After implementing “unification,” all 83 banks and cooperatives merge into a single legal entity, with assets and liabilities of the entire rural credit system packaged together, truly achieving “strengthening the weak and supplementing the shortfall,” and thoroughly resolving local systemic risks from both accounting and substantive perspectives.

A Western Model of “One Province, One Policy” for Rural Credit Reform

The establishment of Gansu Rural Commercial Bank is not only a significant breakthrough in local financial reform but also aligns with the national trend of rural credit reform. Currently, the reform of the rural credit system across the country has entered a critical phase of implementation and tackling difficulties. By early 2026, 13 provinces had completed the establishment of provincial-level legal entities, forming a dual-track pattern of “unified legal entities” rural commercial banks and rural cooperative banks.

Specifically, Liaoning, Hainan, Henan, Inner Mongolia, Jilin, and Xinjiang have adopted the “unified legal entity” model; Zhejiang, Shanxi, Sichuan, Guangxi, Jiangsu, Jiangxi, and Guizhou have chosen the rural commercial joint bank model. At the start of 2026, besides Gansu, Yunnan, Ningxia, and Heilongjiang have also clarified plans to promote provincial rural credit reform.

Industry experts believe that this differentiation reflects the implementation of the central government’s “adapt measures to local conditions” reform principle. For western and central regions, given local economic conditions, provinces with smaller economies, more historical issues, narrower management scope, and fewer legal entities tend to favor the “unified legal entity” approach. Conversely, eastern coastal regions, with more high-quality rural commercial banks, lighter historical burdens, and better operational conditions but greater merger and restructuring pressures, find the “joint bank” model more suitable.

It is noteworthy that Gansu is not the only province to have adjusted its reform path midway. Henan, Xinjiang, and others have also transitioned from “joint bank” to “unified legal entity” schemes. This phenomenon indicates that there is no “one-size-fits-all” answer in rural credit reform and reflects practical considerations of risk concentration and resource integration in different regions.

From a business infrastructure perspective, Gansu’s rural credit system previously included 37 rural commercial banks, 5 rural cooperative banks, 41 county-level federations, nearly 1,904 outlets, covering 86% of administrative villages and 90% of farmers and herders in the province. By the end of 2025, the balance of agricultural loans reached 259.9 billion RMB, accounting for 32% of the total; farm household loans totaled 207.5 billion RMB, making up 65% of the total, with services extending to every corner of urban and rural areas. This extensive service network and deep customer base provide a solid foundation for the future development of Gansu’s rural commercial banks.