China's Big Banks Log Net Profit Growth in 2020 Despite COVID-19
Source: Xinhua
China's major State-owned banks posted higher net profits in 2020 despite the impact of the COVID-19 epidemic and volatile market situations.
Six State-owned banks raked in nearly 1.14 trillion yuan ($173.82 billion) in net profits attributable to shareholders in 2020, up around 1.93 percent year-on-year, according to last year's financial results of these banks.
Postal Savings Bank of China registered the highest yearly profit growth of 5.36 percent, followed by Bank of China and Agricultural Bank of China, which reported increases of 2.92 percent and 1.8 percent in net profits, respectively.
China Construction Bank reported a 1.62-percent rise in net profits, while those of the Bank of Communications and the Industrial and Commercial Bank of China grew 1.28 percent and 1.18 percent, respectively, from a year earlier.
The six lenders also reported narrowing net interest margins, a gauge measuring banks' profitability, amid the downward trend of loan prime rates and financial institutions' efforts to concede their profits to the real economy last year.
Despite difficulties in managing interest margins, Wang Jiang, head of the China Construction Bank, forecast that the bank's net interest margins will remain generally stable this year without large fluctuations.
Meanwhile, the asset quality of all six banks remained stable on the whole while the non-performing loan ratio picked up compared with the beginning of 2020 due to the impact of the COVID-19 epidemic.
The non-performing loan ratio of the Postal Savings Bank of China went up 2 basis points from the beginning of 2020 while that of Bank of China rose 9 basis points.
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