The government is urging its Big Four state-owned banks to ramp up overseas expansion to strengthen their global competitiveness.
Wang Zhaoxing, a vice chairman at the China Banking Regulatory Commission, the banking sector regulator, urged the Big Four to expand their overseas assets and profits from offshore operations. He prodded the Big Four to boost their offshore assets and contribution to profits from overseas business to increase global competitiveness.
The Big Four banks consist of Industrial & Commercial Bank of China Ltd.; China Construction Bank Ltd,; Bank of China Ltd. and Agricultural Bank of China Ltd. and they seem to be complying with Wang's missive.
ICBC, China's largest bank by assets, said its overseas assets at the end of June were up 34% from the end of 2011. Bank of China, the third-largest bank by assets, said it wants to boost its contribution from overseas income to 30% of its total profits in three to five years.
China Construction Bank Ltd, the second-largest lender by assets, is looking to spend as much as US$15 billion to acquire a bank in Europe, bank chairman Wang Hongzhang said. He noted that financial institutions in developed countries are expected to enter into a new round of global expansion after they emerge from current difficulties linked to the weak global economy. This will mean intensified competition to banks from emerging economies.
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