Non-performing Loan Ratio of Chinese Banks Edges Lower in First Quarter, Sector-wide Assets Post Steady Growth

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Chinese banks saw slight declines in their non-performing loan (NPL) ratios in the first quarter of 2022, alongside steady growth in their total asset volume led by large-scale lenders.

As of the end of the first quarter the NPL balance of commercial banks in China was 2.9 trillion yuan, for an increase of 65.3 billion yuan compared to the end of the preceding quarter, according to data released by the China Banking and Insurance Regulatory Commission (CBIRC).

The NPL ratio was 1.69%, for a decline of 0.04 percentage points compared to the end of the preceding quarter.

The domestic and foreign currency assets of Chinese commercial banks totalled 357.9 trillion yuan as of the end of the first quarter, for year-on-year (YoY) growth of 8.6%.

Total domestic and foreign currency assets of China’s large-scale commercial banks were 146 trillion yuan, growing 8.9% YoY to now account for 8.9% of the total.

Joint-stock banks had total assets of 64.1 trillion yuan as of the end of the first quarter, growing 8.3% YoY to account for 17.9% of the sector total.

Chinese insurance companies had total assets of 25.7 trillion yuan as of the end of the first quarter, for an increase of 0.8 trillion yuan, or around 3.2%, compared to the start of the year.

Net profits of Chinese commercial banks stood at 659.5 billion yuan as of the end of the first quarter, for a YoY rise of 7.4%, while the average capital profit rate was 10.92%, for an increase of 1.27 percentage points compared to the end of the preceding quarter. The average asset profit ratio was 0.89% as of the end of the first quarter, for an increase of 0.11 percentage points compared to the end of the previous quarter.