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TRANSCRIPT
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Analysis on ChineseBanking Industry
GROUP MEMBERS:
Yan LiYuanyuan LinShasha LiuGuanlin YangZhimin YangCanhao Zheng
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BackgroundThe total assets of China's bankingindustry rose 17.3 percent to 43.9 trillionyuan (US$5.48 trillion) at the end of 2006,according to the China Banking RegulatoryCommission (CBRC)
The state-owned "Big Four" banks - Bankof China, China Construction Bank, the
Industrial and Commercial Bank of China,and the Agricultural Bank of China - makeup 51.3 percent of the total assets,according to CBRC
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Purpose of the Report
To analyze the performance of sixChinese public listed banks based onperformance measurement & assetquality
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Regulation: Interest Spread
Time Deposit Rate Lending Rate
07.12.20 4.14% 7.47%
07.09.15 3.87% 7.29%
07.08.22 3.60% 7.02%
07.07.20 3.33% 6.84%
07.05.19 3.06% 6.57%
07.03.18 2.79% 6.39%
Change in Interest Spread
3.15%
3.20%3.25%3.30%3.35%3.40%3.45%3.50%3.55%3.60%3.65%
0 7 . 1 2 . 2 0
0 7 . 0 9 . 1 5
0 7 . 0 8 . 2 2
0 7 . 0 7 . 2 0
0 7 . 0 5 . 1 9
0 7 . 0 3 . 1 8
Change in IntSpread
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Regulation: Reservation Rate
0.00%
2.00%
4.00%
6.00%
8.00%
10.00%
12.00%
14.00%
16.00%
1 5 J a n
, 2 0 0 7
2 5 F e b
, 2 0 0 7
1 6 A p r
, 2 0 0 7
1 5 M a y
, 2 0 0 7
5 J u
n , 2 0
0 7
1 5 A u g
, 2 0 0 7
2 5 S e p
, 2 0 0 7
2 5 O c t
, 2 0 0 7
2 6 N o v
, 2 0 0 7
2 5 D e c
, 2 0 0 7
2 5 J a n
, 2 0 0 8
1
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Introduction
Bank Total Asset (inmillion)
Net Income(in million)
ICBC 7,388,648 49,900
China ConstructionBank
5,448,511 46,319
Bank of China 5,325,273 41,892
Bank of Communications 1,719,483 12,274
China Merchant Bank 934,102 6,794
Fujian Industrial Bank 617,704 3,798
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ROA*EM=ROE
Rank Bank Ratio
1Bank Of China 0.94%
2
China Construction
Bank
0.92%
3China MerchantBank
0.81%
4Bank of Communications
0.78%
5ICBC 0.71%
6 Fujian IndustrialBank
0.61%
Rank Bank Ratio
1Fujian IndustrialBank
23.45%
2
China Merchant
Bank
16.74%
3ICBC 15.37%
4China ConstructionBank
15.00%
5Bank of Communication
14.15%
6 Bank Of China 13.47%
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Leverage: Equity to Asset (1/EM)
Rank Bank Ratio
1 Bank Of China 7.85%
2 ICBC 6.27%
3 China Construction Bank 6.06%
4 China Merchant Bank 5.91%
5 Bank of Communication 5.26%
6 Fujian Industrial Bank 2.62%
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Efficiency: Cost/Income
Rank Bank Ratio
1 Fujian Industrial Bank 31.37%
2 ICBC 36.30%
3 China Merchant bank 38.28%
4 Bank Of China 38.96%
5 China Construction Bank 43.97%
6 Bank of communication 47.66%
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NPL
Rank Bank Ratio
1 Fujian Industrial Bank 1.53%
2 China Merchant Bank 2.12%
3 Bank of Communication 2.53%
4 China Construction Bank 3.29%
5 ICBC 3.79%
6 Bank Of China 4.04%
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Allowance/NPL vs Allowance/Loan
Rank Bank Ratio
1Fujian Industrial Bank 237.00%
2China Merchant Bank 135.61%
3Bank of China 96.00%
4Bank of Communication
94.81%
5China ConstructionBank
82.24%
6 ICBC 70.56%
Rank Bank Ratio
1Bank Of China 4%
2
China Merchant
Bank
2.88%
3ChinaConstructionBank
2.70%
4ICBC 2.68%
5Bank of Communication
2.09%
6 Fujian IndustrialBank
1.97%
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Liquidity: Loan/Asset
Rank Bank Ratio
1 Bank of China 1.53%
2 China Construction Bank 2.12%
3 China Merchant Bank 2.53%
4 Bank of Communication 3.29%
5 ICBC 3.79%
6 Fujian Industrial Bank 4.04%
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Core CAR & CAR
Rank Bank Ratio
1ICBC 12.23%
2Bank Of China 11.44%
3China ConstructionBank
9.92%
4China MerchantBank
9.58%
5Bank of Communication
8.52%
6 Fujian IndustrialBank
4.80%
Rank Bank Ratio
1ICBC 14.05%
2Bank Of China 13.59%
3ChinaConstructionBank
12.11%
4China MerchantBank
11.40%
5Bank of Communication
10.83%
6 Fujian IndustrialBank
8.71%
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Vertical Comparison
BOC vs Industrial BankWHY?
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Fluctuation From 2005 To 2006
-5.00%0.00%5.00%
10.00%
15.00%20.00%
25.00%30.00%35.00%
40.00%45.00%
ROA ROE COST to Income
Fujian Industrial Bank Bank of China
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Fluctuation From 2005 To 2006
-40.00%
-30.00%
-20.00%
-10.00%
0.00%
10.00%
20.00%
30.00%
Non-performance Loan
Ratio
Allowances to non-
performing loans %
Allowances to total
loans %
Fujian Industrial Bank Bank of China
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Fluctuation From 2005 To 2006
-10.00%-5.00%0.00%5.00%
10.00%15.00%20.00%25.00%30.00%35.00%
40.00%45.00%
loan/asset % Core capital adequacy
ratio%
Capital adequacy ratio% Total equity to total
assets%
Fujian Industrial Bank Bank of China
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Source of Information
Bank of China 2006 Annual ReportICBC 2006 Annual Report
China Construction Bank 2006Annual ReportBank of Communications 2006
Annual ReportChina Merchant Bank 2006 AnnualReport
Fujian Industrial Bank 2006 Annual
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THANK YOU FOR YOURATTENTION
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