Chinese banks in 2014: another good year

Written by Denis Suslov || March 05 2015

The China Banking Regulatory Commission (CBRC) released its annual banking industry statistics for 2014. Banks accumulated RMB 172.3 trillion in assets, up 13.87% since 2013. The Big 5 large commercial banks had a slower growth rate than the joint-stock commercial banks, 8.25% and 16.50% respectively.

It seems like the government’s strategy to demonopolize banking is working, however there is still a long way to go for smaller joint-stock commercial banks, which number around a dozen but command only 18.21% of all assets, compared to 41.21% of the Big 5 banks.

The regulator also noted an increase in rural-related and SME lending – the policy-driven sectors grew 13.0% and 17.5% respectively, faster than average credit growth in the country.

However, risks are rising as well. The overall Non-performing Loan (NPL) ratio is up 0.25 percentage points to 1.25%. But the regulator assures us this level of NPL is manageable and reports a healthy level of capital adequacy ratio which is up 0.61 percentage points and currently stays at 10.56%. Also, financials look very strong as profits grew 9.65% to RMB 1.5 trillion.

For more trends beyond financials and what to expect in 2015 please see our new Top 10 China Banking Technology Trends 2015 study.

Chinese banks profits revenues 2015