Financial Indicators – China Q2(2016) – Summary

Copyright: China Banking Regulatory Commission

“Recently, the CBRC released supervisory statistics of Q2, 2016. Banking assets and liabilities increased steadily. By the end of the second quarter of 2016, RMB and foreign currency assets of Chinese banking institutions at home and abroad reached 218 trillion yuan, up by 15.7% year on year. Assets of large commercial banks registered 83.4 trillion yuan, accounting for 38.3% of total amount, and up by 7.4% year on year. Assets of joint-equity commercial banks reached 40.4 trillion yuan, accounting for 18.5% of the total, up by 15.3% year on year. RMB and foreign currency liabilities of banking institutions at home and abroad reached 201.8 trillion yuan, an increase of 15.2% year on year. Liabilities of large commercial banks registered 77.1 trillion yuan, taking up 38.2% of the total amount, and up by 7% year on year. Liabilities of joint-stock commercial banks were 37.9 trillion yuan, accounting for 18.8% of the total, up by 15.2% year on year. The banking sector continued to strengthen financial support for key social and economic areas and civil livelihood projects.The banking sector further improved differentiated credit policies, optimized loan portfolios and strengthened financial support for agro-related areas, micro- and small-sized enterprises (MSEs), government-subsidized housing projects, etc. By the end of the second quarter, agro-related loans (excluding bill financing) balance of banking institutions reached 27.3 trillion yuan, up by 8.7% year on year. The outstanding balance of loans to MSEs (including MSE loans, individual business loans and MSE owner loans) reached 25 trillion yuan, up by 13.2% year on year. Loans to credit card consumption and government-subsidized housing projects increased by 17.2% and 62.0% respectively, which are higher than other loans by 4.2 and 49 percentage points respectively. The quality of credit assets was generally under control. By the end of the second quarter, 2016, outstanding balance of NPLs of commercial banks was 1.4373 trillion yuan, up by 45.2 billion yuan compared with the end of the previous quarter. NPL ratio of commercial banks was 1.75%, remaining the same as the previous quarter. By the end of the second quarter 2016, outstanding balance of performing loans was 80.8 trillion yuan, among which, standard loans balance was 77.5 trillion yuan and the balance of special mention loans was 3.3 trillion yuan. (According to regulations, commercial banks should divide loans into standard loans, special mention loans, secondary loans, doubtful loans and loss loans based on the degree of risks. The former two belong to the category of performing loans, while the latter three are NPLs. In terms of special mention loans, the borrower is currently able to pay back the principal and interest, while there exist some factors that might potentially affect the repayment). The growth of profit was slightly slower. By the end of the second quarter, 2016, the accumulated net profit of commercial banks of the year was 0.8991 trillion yuan, up by 3.17% year on year. The average ROA of commercial banks of the first quarter of 2016 was 1.11%, down by 0.08 percentage point year on year. The average ROE was 15.16%, down by 0.77 percentage point. Overall risk resilience maintained stable. The banks maintained adequate loan loss provisions for credit risks. By the end of the second quarter, 2016, balance of loan loss provisions of commercial banks reached 2.5291 trillion yuan, increased by 92.4 billion yuancompared with the end of the previous quarter; the provision coverage ratio was 175.96 %, up by 0.93 percentage points compared with the end of the previous quarter; and loan provision ratio was 3.07%, up by 0.02 percentage points compared with the end of the previous quarter. By the end of the second quarter, 2016, the weighted average core tier 1 CAR of commercial banks (excluding branches of foreign banks) was 10.69%, down by 0.27 percentage point compared with the end of the previous quarter; weighted average tier 1 CAR was 11.10%, down by 0.28 percentage point compared with the end of the previous quarter; weighted average CAR was 13.11%, down by 0.25 percentage point compared with the end of the previous quarter. Liquidity remained adequate. By the end of the second quarter, 2016, the liquidity ratio of commercial banks was 48.14%, up by 0.06 percentage point compared with the end of the previous quarter; RMB excess reserve ratio was 2.28%, up by 0.22 percentage point compared with the end of the previous quarter; the loan-to-deposit ratio (RMB) was 67.22%, up by 0.21 percentage point compared with the end of the previous quarter”

Copyright: China Banking Regulatory Commission

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