BEIJIN) – Profits of China’s banking sector are expected to maintain steady this year, with faster growth in asset scale and ample liquidity, according to an industry report, Xihna reports.
The 2018 net profit of commercial banks reached 1.83 trillion yuan (around
266.6 billion U.S. dollars), up 4.7 percent year on year, said the report
released by the China Banking Association.
In 2018, the bank provision coverage ratio, a measure of funds set aside to
cover bad loans, rose 4.89 percentage points to 186.31 percent.
The banking sector will face the challenges of intensified competition for
capital sources and flexible pricing of deposit interest rates in 2019,
pushing commercial banks to improve financial services and diversify debt
Meanwhile, commercial banks will see more room for direct financing
development due to regulators’ support in equity financing and bond market.
By the end of 2018, commercial banks’ liabilities amounted to 193.49
trillion yuan with the growth rate down 1.7 percentage points compared with 2017, the report said.