Banking and insurance assets increased steadily.As of the end of 2023 Q3, the total RMB and foreign currency assets of China’s banking institutions at home and abroad reached RMB 409.8 trillion, up by 9.5% year on year. Among those, assets of large commercial banks registered RMB 173.3 trillion, up by 12.1% year on year, and accounting for 42.3% of the total. Assets of joint-stock commercial banks reached RMB 69.6 trillion, up by 6.7% year on year, and accounting for 17% of the total.

At the end of 2023 Q3, total assets of the insurance companies amounted to RMB 29.6 trillion, an increase of RMB 2.4 trillion and up by 9% from the beginning of the year. Compared with the beginning of the year, assets of property and casualty insurance companies registered RMB 2.8 trillion, up by 6.6%; assets of personal insurance companies reached RMB 25.4 trillion, up by 8.9%; assets of reinsurance companies recorded RMB 769.2 billion, up by 14.5%; assets of insurance asset management companies were RMB 104.1 billion, up by 0.5%.

The banking and insurance sectors continued to enhance financial services. As of the end of 2023 Q3, the outstanding balance of loans to micro and small enterprises (“MSEs”, including MSE loans, individual business owner loans and MSE owner loans) reached RMB 69.2 trillion. The outstanding balance of inclusive loans to MSEs with single account credit amount not exceeding RMB 10 million reached RMB 28.4 trillion, up by 23.9% year on year. Loans to government-subsidized housing projects reached RMB 6.5 trillion.

In the first three quarters of 2023, insurance companies had recorded primary insurance premium income of RMB 4.3 trillion, up by 11% year on year. The claim and benefit payments reached RMB 1.4 trillion, up by 20.1% year on year. The number of new insurance policies was 53.7 billion, up by 39.2% year on year.

Asset quality of commercial banks is basically stable.As of the end of 2023 Q3, outstanding balance of NPLs of commercial banks (legal entity, the same below) was RMB 3.2 trillion, up by RMB 24.4 billion compared with the end of the previous quarter. The NPL ratio of commercial banks was 1.61%, a decrease of 0.01 percentage points compared with the end of the previous quarter.

As of the end of 2023 Q3, outstanding balance of performing loans of commercial banks was RMB 197.1 trillion, among which the balance of normal loans was RMB 192.7 trillion and the balance of special-mention loans was RMB 4.4 trillion.

Commercial banks remained resilient against risks.In the first three quarters of 2023, commercial banks had accumulated net profit of RMB 1.9 trillion, up by 1.6% year on year. Compared with the end of last quarter, the average ROE of commercial banks was 9.45%, down by 0.21 percentage points, and the average ROA was 0.74%, down by 0.01 percentage points.

As of the end of 2023 Q3, the balance of loan loss provisions of commercial banks reached RMB 6.7 trillion, which increased by RMB 107.1 billion compared with the end of last quarter. The provision coverage ratio was 207.89%, up by 1.8 percentage points compared with the end of last quarter. The loan provision ratio was 3.35%, basically the same as the end of last quarter.

As of the end of 2023 Q3, the capital adequacy ratio (CAR) of commercial banks (excluding branches of foreign banks) was 14.77%, up by 0.11 percentage points compared with the end of last quarter. Compared with the end of last quarter, tier 1 CAR was 11.9%, up by 0.12 percentage points, and core tier 1 CAR was 10.36%, up by 0.08 percentage points.

Liquidity of commercial banks remained sound.As of the end of 2023 Q3, the liquidity coverage ratio of commercial banks was 143.54%, down by 7.3 percentage points compared with the end of last quarter; liquidity ratio was 65.15%, up by 0.8 percentage points compared with the end of last quarter; the RMB excess reserve ratio was 1.48%, down by 0.3 percentage points compared with the end of last quarter; and the loan-to-deposit ratio (domestic loans and deposits denominated in RMB) was 78.2%, up by 0.5 percentage points compared with the end of last quarter.

Solvency status of the insurance sector.  As of the end of 2023 Q3, the comprehensive solvency ratio of the insurance sector was 194%, and the core solvency ratio was 126%. The comprehensive solvency ratios of property and casualty insurance companies, personal insurance companies and reinsurance companies are respectively 232%, 184.1% and 278.3%, and the core solvency ratios are respectively 200%, 108.6% and 242.3%.