Small-scale Rural Financial Institutions See Total Assets Grow 10% YoY: China Banking Association

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China’s small-scale rural financial institutions saw double-digit growth in their collective assets in 2021, according to the latest data from the peak body for the Chinese banking sector.

As of the end of 2021, the total assets of China’s small and medium-sized rural village financial institutions stood at 45.69 trillion yuan, for year-on-year (YoY) growth of 10%, according to figures from the “National Rural Village Small and Medium-sized Banking Institution Sector Development Report” (全国农村中小银行机构行业发展报告(2022)) recently released by the China Banking Association (CBA).

Total liabilities also grew by 10% YoY in 2021, reaching 42.23 trillion in total by the year’s end.

Loan assets as a share of total assets rose from 53.82% in 2020 to 55.01% in 2021, for an increase of 1.19 percentage points.Deposits as a share of total liabilities increased from 84.14% in 2020 to 84.35% in 2021, for a rise of 0.22 percentage points.

The net profits of rural village commercial banks in 2021 were 213 billion yuan, for a YoY increase of 9.06%. Net interest spreads rose from 2.20% in the first quarter to 2.33% in the final quarter.

The non-performing loan (NPL) ratio for rural village commercial banks was 3.64% in 2021, for a YoY decline of 0.25 percentage points, and a three-year low. The provisions coverage ratio was 129.48%, for a YoY rise of 7.29 percentage points.

Village county banks (村镇银行) saw net profits of 10.976 billion yuan, for an increase of 3.342 billion yuan, or 43.73%, compared to the previous year. Their NPL ratio was 3.47%, for a YoY decline of 0.16 percentage points.