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Wan LixinOpinion deputy editor of Shanghai Daily
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CCB expects 17% lending growth
By Zhang Fengming |
February 11, 2009, Wednesday
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Online Edition
Online Edition
CHINA Construction Bank expects its lending to grow close to 17 percent this year and is not interested in foreign acquisitions, Chairman Guo Shuqing said in an interview published today.
Guo expressed his confidence in the bank's loan growth this year, which he expects to keep in line with last year's near 17 percent increase.
Guo also expects a lower profitability because of the central bank's five rates cuts and narrower margins, he told the Asian Banker today.
The bank is at the forefront of the central government's stimulus package to add infrastructure as it is the main player in China's infrastructure lending.
The bank also sees the small business sector as a major section offering high profits.
"Small business banking for us is a strategic area because the profit margin can be very high," Guo said.
The bank charged on average 6 percent to 7 percent for small business credit last year. The interest charge can reach 14 percent to 18 percent in the underground market as small business has little access to banks because of limited collateral and a lack of credit records.
Small and medium-sized enterprises accounted for less than 25 percent of lending for the Beijing-based bank.
On the overseas front, Guo said the bank has no interest in investing overseas at present as "it's still not a very good time because there is so much uncertainty."
"There is a lot of bad debt and bad assets coming on to the books. We are not so keen to do that at the moment. We are mainly a domestic bank. We have a very big market here," he said.
Guo expressed his confidence in the bank's loan growth this year, which he expects to keep in line with last year's near 17 percent increase.
Guo also expects a lower profitability because of the central bank's five rates cuts and narrower margins, he told the Asian Banker today.
The bank is at the forefront of the central government's stimulus package to add infrastructure as it is the main player in China's infrastructure lending.
The bank also sees the small business sector as a major section offering high profits.
"Small business banking for us is a strategic area because the profit margin can be very high," Guo said.
The bank charged on average 6 percent to 7 percent for small business credit last year. The interest charge can reach 14 percent to 18 percent in the underground market as small business has little access to banks because of limited collateral and a lack of credit records.
Small and medium-sized enterprises accounted for less than 25 percent of lending for the Beijing-based bank.
On the overseas front, Guo said the bank has no interest in investing overseas at present as "it's still not a very good time because there is so much uncertainty."
"There is a lot of bad debt and bad assets coming on to the books. We are not so keen to do that at the moment. We are mainly a domestic bank. We have a very big market here," he said.
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