Big banks announce hard-won growth in 2020

Hello RF

China’s major state-owned banks overcame the difficulties of 2020 with stable improvement in operating results and hard-won growth, according to their budget reports.

Among the top six banks, Postal Savings Bank of China reported net profit of 64.3 billion yuan ($ 9.77 billion), an increase of 5.38% year-on-year, higher than its peers comparable.

Its assets stood at 11.3 trillion yuan, up 11% from the end of the previous year, ranking fifth among commercial banks in China, with operating profit up 3 , 4% to 286.5 billion yuan.

Boasting an extensive physical network spanning urban and rural areas, the bank has served 622 million individual customers, with retail customer assets under management totaling 11.2 trillion yuan.

The net profit growth of China Construction Bank, Agricultural Bank of China and Bank of China stood at 1.62%, 1.60% and 1.59%, respectively, while the Industrial Bank China Commercial and Bank of Communications recorded relatively slower growth of 1.4% and 1.28. percent.

In 2020, the banking sector interest spread narrowed and interest margin income narrowed, which put pressure on profitability.

The China Construction Bank, for example, noted in its financial results that loan yields had declined due to factors such as a drop in the prime rate on loans and increased efforts to give up a portion of the profits to support the real economy.

As a result, the net interest margin, the difference between banks’ lending and lending rates, fell 13 basis points from 2019 to 2.19.

ICBC, the country’s largest lender, said it saw a 2.48 trillion yuan increase in domestic yuan deposits (including interbank deposits), reaching an all-time high.

He was also successful in implementing the policy of deferral of the loan department, relieving more than 100,000 clients of such pressure, and the corresponding loans amounted to 1.5 trillion yuan.

Thanks to the efforts of the banks to control operational risks, the total assets of the sector have increased steadily with stable liquidity and credit quality. The ratio of their non-performing assets was held in a stable range, with Postal Savings Bank reporting a bad debt ratio of 0.88%, the lowest among the six largest lenders, and Bank of Communications of 1 , 67, the highest.

Over the past year, the rapid development of financial technology has led to the digital transformation of the banking sector and banks have all shared their efforts in this regard.

Postal Savings Bank said it has built a Big Data platform, a cloud computing platform, a blockchain service and an artificial intelligence platform “PSBC Brain”, and has created a middle office with fintech to strengthen customer marketing, operations and risk management.

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