Assets held by private banks in China surge 22pc in value

China’s top 10 private banks see average asset under management grow 35 per cent annually since 2012

PUBLISHED : Thursday, 28 September, 2017, 1:12pm
UPDATED : Thursday, 28 September, 2017, 11:04pm

China’s top 10 private banks held over 7.5 trillion yuan (US$1.1 trillion) in client assets at the end of 2016, an annual 22 per cent increase and an average growth rate of 35 per cent since 2012, according to fresh research from Asian Private Banker magazine.

“Assets under management (AUM) growth for China’s top 10 private banks also outpaced Asia’s (non-China) top 20 private banks, whose assets climbed by just 6.1 per cent over the same period,” said the research study.

The results underline just how China’s domestic retail banking giants now dominate the wealth management industry.

China Merchants Bank (CMB) Private Banking led the pack with over 1.6 trillion yuan in AUM. It also enjoys a higher efficiency rating, with its 602 relationship management team less than half the size of the second-ranked Industrial and Commercial Bank of China (ICBC) Private Banking, which has 1.2 trillion yuan of AUM. Bank of China (BOC) Private Banking came third with 1 trillion yuan worth.

The total number of domestic private banking clients reached just under 475,000 and combined tier-one private banking branches increased to 347 in 2016 from 331 in 2015, the research shows.

China continues to create high-net-worth individuals (HNWIs) at a torrid pace, despite the slow down in economic growth, a report from Bain showed in July.

The number of Chinese with at least 10 million yuan (about US $1.5 million) in investible assets increased from 180,000 in 2006 to nearly 1.6 million in 2016, representing a more than eightfold expansion within a decade, it found.

But among HNWIs, the ranks of the richest of the rich – those with at least 100 million yuan (US$15 million) in investible assets – have grown at an even-faster rate.

Bain calculates there are now 116,000 of these ultra-high-net-worth individuals (UHNWIs), compared with 7,000 in 2006.