China’s Big State-owned Banks Expand to Six in Total

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The ranks of China’s official big state-owned banks have seen an increase to six in total following the inclusion of the Postal Savings Bank of China according to domestic media reports.

Sources from Postal Savings Bank said to ThePaper.com.cn that on 24 January the bank received a directive from the China Banking and Insurance Regulatory Commission (CBIRC) announcing the decision to officially include it as a “big state-owned commercial bank” (国有大型商业银行).

The decision will bring the number of official big state-owned banks in China to six, alongside Agricultural Bank of China, Bank of China, Bank of Communications, China Construction Bank and Industrial and Commercial Bank of China.

Posting Savings Bank was established in March 2007 as a fully owned subsidiary of state agency China Post with registered capital of 20 billion yuan.

Liu Andong (刘安东), CEO and party secretary of China Post, was appointed the chair of Postal Savings Bank while Tao Liming (陶礼明), head of the China Postal Savings and Remittance Bureau, was appointed bank president.

On 21 January 2012 Postal Savings Bank was converted into a joint stock limited liability company, and in 2016 it successfully listed on the main board of the Hong Kong Stock Exchange, marking its debut on international capital markets.

In September 2017 Postal Savings Bank issued USD$7.25 billion in preferred stock outside of China, for the largest issue of preferred stock by an international financial institution since 2010.

According to Postal Savings Bank’s annual report from 2017 its total assets exceeded 9 trillion yuan, for a disparity of 0.2 trillion yuan compared to Bank of Communications.

2017 full year net profits were 47.709 billion yuan for YoY growth of 19.94%, while net interest margins were 2.4%, ahead of the average for large-scale commercial banks in China.

Postal Savings Bank’s non-performing loan (NPL) ratio was markedly lower than the sector-wide average at 0.75%, following an increase of 979 million yuan in the NPL balance in 2017 to reach 27.22 billion yuan.

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