Chinas big banks warn of more margin pressure in the second half
Shrinking margins show stress symptoms for China’s large banks
ICBC net interest margin 1.3%
The dismissed credit rate keeps a constant but the credit demand is warm
Unqualified Chinese economy, which faces new pressures from US tariffs
By Ziyi Tang, Engen Tham and Selena Li
China’s largest state banks, net interest margins, the world’s second largest economy and global economic volatility drowned with the rest of the year will encounter increasing pressure.
The profit margins of the sector have been under pressure since the COVİD-19 pandem, weighed with consecutive Central Bank interest rate deductions to increase the slowing economy and weak loan demand.
According to assets, the country’s top five banks, one of the world’s largest loans, reported the first half margins in the earnings reports on Friday. Net interest margins are an important indicator of the profitability of banks.
“We are confronted with common pressures and difficulties such as Chinese bank, industry peers in the second half of the year, but actively respond to them and to protect their general stable business performance,” Bank of Bank of China President Zhang Hui said in a briefing. He said.
“The low interest rate in China, this is a common difficulty for everyone.”
The lender of the lender Vice President Zhou Wanfu said Bank of Communication’s margins will be under pressure in the future. However, the decline rate in the last two years will be slow, he added.
Chinese Industry and Commercial Bank, China Construction Bank Corp, China Communication Bank Co Ltd, Bank of China Ltd and China Agricultural Bank have a decline in net interest margins for the last six months.
The net interest margin of Chinese banks has shown that the last June of June has fallen to a record level of 1.42%, and that official data is below a 1.8% threshold in the sector to maintain reasonable profitability.
Five banks, Hong Kong and Mainland Chinese financial markets after the closure of the first half of their earnings on Friday.
The net profit results between the group are mixed, the agricultural bank increased by 2.7% and the Bank Off Bank increased by 1.61%, well above the estimates of the analysts.
The remaining three people said the net profit fell between 0.85% and 1.4%. The decline of the Chinese Construction Bank opposed the expectations that analysts’ net profit would increase.
The reports also showed that, especially smaller businesses and consumers, despite the deterioration of the quality of assets and sharply opposed to higher US tariffs, the loan values that do not perform within the last six months remained relatively constant.
In March to support the stability of the banking sector and to provide credit flow to economically important sectors, four of China’s largest state loans in March revealed a 72 billion dollar re -capital planning plan.
In addition to lower interest rates, local banks face assembly print to provide cheaper loans or easier reimbursement conditions to help fighting businesses. Superior Yuan loans increased by 6.9% in July compared to the previous year, record is low.
The patient real estate sector, which was once an important growth driver, continues to be a great difficulty for the lenders.
China Bank Vice President Wu Jian, “Recosition of the real estate sector continues,” he said.
“Looking at the newly emerged loans, the real estate sector continues to be the best sector for uncompromising loans.” He said.
China’s real estate market
Prices, sales, new investments and construction reduction have been collapsing for more than four years and focuses on economic growth. Analysts are not sure when the conditions will come out.
Agbank President Zhihang, “the real estate sector will focus on credit risk management.” He said.
This article was created from an automatic news agency feeding without changing the text.
