Days ago, BANK OF GUIZHOU (ASX: 06199) held its 2025 annual general meeting of shareholders in Guiyang City.

The meeting saw the passage of 15 proposals.

Undoubtedly, the market's focus was on the vote regarding the entry of the new Chairman, Yang Hongjun, into the board of directors.

According to the shareholder vote, the proposal to appoint Yang Hongjun as an executive director of the bank's fourth board of directors received 100% approval, with no shareholders opposing.

Shareholder Confidence in Leadership

Shareholders evidently recognize Yang Hongjun's capabilities.

The 58-year-old Yang is actually a lawyer by training.

He graduated with a degree in Economic Law from Southwest University of Political Science & Law in September 1991.

From September 1991 to February 2024, Yang worked at various branches of Agricultural Bank of China, including the Qiannan and Qianxinan branches, as well as the Guizhou Provincial Branch, demonstrating a strong work ethic throughout his career.

While managing a demanding workload, Yang also pursued further studies. He graduated from Guizhou University with a Master of Laws degree in June 2009.

He currently holds the professional title of Senior Economist and is a qualified lawyer.

In 2024, Yang participated in the establishment of Guizhou Rural Commercial United Bank. By the end of December 2025, when the bank officially commenced operations, Yang became its inaugural president.

This background shows that Yang Hongjun combines legal expertise with over three decades of banking management experience, equipping him with capabilities in structuring local rural financial systems and integrating institutional operations.

Current Challenges for the Bank

The present-day BANK OF GUIZHOU requires such a strong leader.

As the only provincial-level city commercial bank in Guizhou formed through a three-way merger, it has now surpassed the 600 billion yuan asset mark, entering a new phase of development.

Simultaneously, the bank is facing profitability pressures.

In the first quarter of 2026, the bank reported operating revenue of 3.063 billion yuan, a year-on-year increase of 2.17%, but its net profit attributable to shareholders was 1.336 billion yuan, a decrease of 2.20% year-on-year, indicating a state of increased revenue without corresponding profit growth.

The market anticipates that Yang Hongjun will bring new momentum for development to BANK OF GUIZHOU.

Immediate Priority for the New Chairman

Returning to the present, the first challenge facing Yang Hongjun is the reform of a village and township bank.

At this shareholders' meeting, a special resolution concerning the review and approval of the reform plan for Panzhou Wanhe Village Bank encountered opposition from some shareholders.

The proposal received 96.205% approval, 1.537% opposition, and 2.258% abstention.

According to the plan, BANK OF GUIZHOU, as the primary sponsoring bank of Panzhou Wanhe Village Bank, intends to take over its deposit-related businesses, including associated bank cards and branch services, and arrange for the placement of its employees.

Panzhou Wanhe will establish a trust with all its cash and asset income rights. BANK OF GUIZHOU will receive trust beneficiary rights as consideration for taking over the deposits, based on the creditor's rights formed from assuming Panzhou Wanhe's deposits.

Panzhou Wanhe Village Bank was established in April 2012 with a registered capital of 130 million yuan. BANK OF GUIZHOU holds 26 million shares, representing a 20% stake.

Reasons for Shareholder Concerns

It is understandable that shareholders have differing opinions on reforming the village bank.

On one hand, exploring this new path for risk resolution itself presents a risk for BANK OF GUIZHOU.

The mainstream market approaches for village bank reform are typically "conversion to a branch" or "merger and restructuring." However, BANK OF GUIZHOU has opted for a trust-based disposal model, which neither relies on cash payments nor triggers equity changes.

The bank previously used this same method for the reform of Longli Guofeng Village Bank.

On the other hand, Panzhou Wanhe Village Bank faces issues such as a relatively high non-performing loan ratio and significant operational pressures. Post-reform, related risks could potentially be transferred to BANK OF GUIZHOU.

Data shows that in 2024, Panzhou Wanhe Village Bank reported a net profit of 2.2004 million yuan, with non-performing loans amounting to 27.4906 million yuan, pushing its non-performing loan ratio up to 2.41%.