China’s biggest state-owned banks posted a robust increase in profits for 2021 but most warned that the country faces a gloomy outlook.
China’s ‘big six’ banks – ICBC, China Construction Bank, Agricultural Bank of China, Bank of China, Bank of Communications and Postal Savings Bank of China – all saw net profits climb with an average increase of 12 percent in 2021.
This marks the best performance for the six lenders since a 14.5 percent profit increase in 2013.
Postal Savings Bank of China topped the ‘big six’ lenders with an 18.7 percent increase in net profit to 76.2 billion ($12 billion).
Pessimistic Outlook
Despite the positive performance, the Chinese state banks expressed pessimism about the environment moving forward.
In their annual earnings report, ICBC warned that China faces «shrinking demand, disrupted supply and weakening expectations» while Bank of China highlighted that the «global epidemic will continue to recur, the easing policies of developed economies will be withdrawn, geopolitical conflicts will intensify».
Bank of Communications president Ren Deqi said last Friday that it would be difficult to deliver satisfactory earnings this year.
The 2021 results for China’s ‘big six’ banks are as follows:
ICBC – net profit up 10 percent to 348.3 billion yuan, NPL down from 1.58 percent to 1.42 percent.
China Construction Bank – net profit up 11.6 percent to 302.5 billion yuan, NPL down from 1.56 percent to 1.42 percent
Bank of China – net profit up 12 percent to 216.6 billion yuan, NPL down from 1.46 percent to 1.33 percent
Bank of Communications – net profit up 11.9 percent to 87.6 billion yuan, NPL ratio down from 1.67 percent to 1.33 percent
Postal Savings Bank of China – net profit up 18.7 percent jump to 76.2 billion yuan, NPL down from 0.88 percent to 0.82 percent
