New loans reached a record amount of $862.89b.
Reuters reported that China’s big five state-owned banks recorded ‘modest’ profit growth in Q1 as policymakers pushed lenders to facilitate more loans amidst China’s economic slowdown.
Chinese banks extended a record amount of $862.89b (RMB5.81t) worth of new credit in Q1.
ICBC, which is considered as the world’s biggest bank in terms of assets, saw its profit rise 4.1% to $12.7b (RMB82.01b) whilst Bank of Communications (BoCom) booked its fastest quarterly growth in five years with a 4.9% rise in profits to $3.13b (RMB21.07b).
Meanwhile, non-performing loan (NPL) ratios fell at ICBC, BoCom and Agricultural Bank of China, and held steady at China Construction Bank (CCB) and Bank of China (BoC). Net interest margin (NIM), a key gauge of profitability, improved slightly at ICBC and BoCom but narrowed by 0.08 ppt at BoC and 0.02 pptat CCB in Q1.
“The formation of new NPLs can’t be taken lightly should the macroeconomic situation become less stable, so there’s a lingering concern for the asset quality,” Nicholas Zhu, a Beijing-based banking analyst of Moody’s Investors Service, said.
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