Major Chinese state-owned banks post earnings growth amid ‘positive signs of recovery’ in economy: Agricultural Bank of China, China Construction Bank, Bank Of China and Postal Savings Bank of China
- This year, Agricultural Bank of China ‘will act as a major bank serving the real economy and as a cornerstone of financial stability’, chairman says
- BOC will ‘serve as a bedrock of financial stability’: exchange filing
ABC, China’s third-largest bank by assets, saw its net profit jump 4.2 per cent to 269.8 billion yuan (US$37.3 billion), it said in a stock-exchange filing on Thursday. Its operating income – consisting mainly of interest income and fees – also edged up slightly to 695.5 billion yuan, from 695.3 billion yuan the previous year.
“In 2024, we will adhere to the general principle of pursuing progress while maintaining stability, and will act as a major bank serving the real economy and as a cornerstone of financial stability.”
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ABC’s non-performing loan (NPL) ratio, a metric of potential bank losses, improved to 1.33 per cent from 1.37 per cent, marking a third consecutive year of decline, Gu said.
While the bank’s special-mention loans, a key indicator of souring loans, increased by 32.3 billion yuan in 2023 to 320.1 billion yuan, their ratio relative to the bank’s total loans improved to 1.42 per cent from 1.46 per cent the previous year.
“In 2023, our new non-performing loans were primarily concentrated in areas such as real estate and local government financing vehicles, but the overall risk is manageable,” said Zhang Xuguang, the bank’s vice-president.
“In 2024, we expect our asset quality to remain steady, owing in part to policy measures that have boosted growth and employment.
“We are also steadily improving our credit structure. In 2023, over 80 per cent of our loans went to advanced manufacturing, infrastructure and other important areas, which has also increased the ratio of quality clients.”
Bocom posts slight rise in profits and points to improving asset quality
CCB, China’s second-largest bank by assets, reported a net profit of 332.5 billion yuan for 2023, a 2.34 per cent increase from the previous year.
The bank’s operating income, however, narrowed to 745.6 billion yuan, compared to 757.5 billion yuan the previous year.
Its net interest margin (NIM) also dropped to 1.7 per cent from 2.01 per cent a year ago. Meanwhile, its NPL ratio improved to 1.37 per cent last year, compared to 1.38 per cent in 2022.
BOC, the country’s oldest and largest international lender with total assets of 32.43 trillion yuan, posted a net profit of 231.9 billion yuan for the year, an increase of 2.38 per cent from 226.5 billion yuan in 2022.
Its operating income also rose to 624.1 billion yuan, compared to 586.5 billion yuan the previous year. BOC’s NPL ratio improved to 1.27 per cent in 2023, compared to 1.32 per cent the previous year. Its NIM fell to 1.59 per cent from 1.75 per cent in 2022.
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“The Chinese economy will continue to rebound and improve, economic vitality will continue to increase, social expectations will continue to improve and achieve effective improvement in quality and reasonable growth in quantity,” BOC said in a filing on Thursday.
As the bank continues to serve the real economy, it will also “balance development and security, effectively forestall and defuse financial risks, and serve as a bedrock of financial stability”, it added.
PSBC, meanwhile, reported a net profit of 86.4 billion yuan for the year, a 1.25 per cent increase from the preceding year, according to an exchange filing.
Its operating income jumped to 324.9 billion yuan in 2023, a 2.24 per cent increase from the previous year.
The bank’s NIM in 2023 was 2.01 per cent, compared to 2.2 per cent in 2022. Its NPL ratio dropped to 0.83 per cent from 0.84 per cent a year ago.
