Asia still key market for ICBC's overseas growth
Industrial and Commercial Bank of China, the world's largest bank by market value, said it would continue its overseas expansion and Asia remained a key market for its 'going-out' policy.
Senior executive vice-president Yi Huiman said the bank had advantages in terms of cultural links in Asia.
'Capital is not our main concern, but we have to consider if we can manage it,' he said at a financial conference yesterday, adding that the bank had made a few acquisitions in the past in the region that had proved successful. 'Emerging markets in Asia are our first choice.'
The bank is reportedly seeking to buy a controlling stake in ACL Bank, a Thailand lender, from the Thai government, according to Bloomberg.
ICBC has expanded its footprint outside the mainland through organic growth and acquisitions in recent years.
The bank completed a deal to buy 90 per cent of Halim Bank in Indonesia in 2007. It also completed the acquisition of about 80 per cent of Seng Heng Bank, Macau in 2008, and acquired 20 per cent of South Africa's Standard Bank in the same year. It agreed to buy 70 per cent of Bank of East Asia's Canada unit in June for C$80.25 million (HK$573.6 million).
Lian Ping, the chief economist at Bank of Communications, said it was a logical step for mainland lenders to expand overseas as the mainland financial market opened up further, but whether this overseas expansion would be successful or not needed to be seen.
However, Lian said that other than extending their operation overseas, mainland banks could also work with foreign banks locally to facilitate their business development.
In the home market, Yi said the government's stimulus measures were effective as the economy had recovered, adding that it was not only good for the mainland but also good for the whole world.
In the first half of this year, mainland banks extended a combined 7.37 trillion yuan (HK$8.36 trillion) of loans, triple the amount lent in the same period a year earlier.
He said some people had expressed concerns that the surge in lending would cause high non-performing loan levels. He said ICBC had managed the risk well and both non-performing loan and bad-debt ratio fell in the first half of the year.
Piling up
Total loans extended by mainland banks in the first half of this year, in yuan: 7.4tr yuan
