Chinese units of banks in elite list
By Hu Xiaocen |
October 25, 2012, Thursday
|
Print Edition
Print Edition
THE Chinese subsidiaries of four overseas banks have made it to the list of China's top 50 banks, a Standard and Poor's report said yesterday.
HSBC China, Bank of East Asia China, Standard Chartered Bank China and Citibank China are listed among China's top 50 banks by assets after years of expansion and investment in the country, according to the report by the rating firm.
The top 50 banks' combined net profits sextupled to 995.1 billion yuan (US$157.9 billion) from 2007 to 2011, accounting for 76.3 percent of the banking sector's total profits. While the largest banks' return on average assets rose significantly on a lending spree and surging fee income, the foreign banks' subsidiaries are still recovering their lost ground, S&P reported.
"Their heavy investment in retail banking has yet to prove positive to their profitability. For some banks, aggressive asset growth could not only escalate their credit risks but also challenge their operational risk management," the report said.
The top four overseas lenders made a combined after-tax net profit of 6.9 billion yuan last year - more than double from a year earlier, an earlier KPMG report said.
S&P said the rising profits in foreign banks last year mainly reflected their improving cost efficiency, as operating expenses related to network expansion declined.
Banks in China are facing strengthening polarization, and more rural banks joined the list, driving out some less competitive city commercial lenders.
HSBC China, Bank of East Asia China, Standard Chartered Bank China and Citibank China are listed among China's top 50 banks by assets after years of expansion and investment in the country, according to the report by the rating firm.
The top 50 banks' combined net profits sextupled to 995.1 billion yuan (US$157.9 billion) from 2007 to 2011, accounting for 76.3 percent of the banking sector's total profits. While the largest banks' return on average assets rose significantly on a lending spree and surging fee income, the foreign banks' subsidiaries are still recovering their lost ground, S&P reported.
"Their heavy investment in retail banking has yet to prove positive to their profitability. For some banks, aggressive asset growth could not only escalate their credit risks but also challenge their operational risk management," the report said.
The top four overseas lenders made a combined after-tax net profit of 6.9 billion yuan last year - more than double from a year earlier, an earlier KPMG report said.
S&P said the rising profits in foreign banks last year mainly reflected their improving cost efficiency, as operating expenses related to network expansion declined.
Banks in China are facing strengthening polarization, and more rural banks joined the list, driving out some less competitive city commercial lenders.
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