GUANGZHOU- In
line with China's WTO commitment of fully opening
up its banking industry to foreign capital by the
end of this year, Chinese banks are flexing their
muscles in order to take the first mover advantage
and to meet the challenges as well as
opportunities.
For example, the Industrial
and Commercial Bank of China, China's largest
state-owned bank, has launched new gas credit card
service to help drivers fuel their cars at gas
stations. The
move
has been regarded as a symbol that the ICBC is now
taking the initiative to meet market demand
instead of waiting for customers.
ICBC's
gas cards, jointly issued with Sinopec, China's
largest oil product provider, can be accepted by
some 8,000 Sinopec gas stations, over 20,000 ICBC
offices and 17,000 point of sale (POS) and
automated teller machine (ATM) machines all over
the country.
"[The] profit-making model of
state-owned banks like ICBC should be changed,"
said an official with ICBC Guangzhou branch in
south China's Guangdong province,
adding that "we should develop and strengthen
intermediary business, in addition to conventional
business, so as to improve the service quality for
local residents."
In fact, in the city of
Guangzhou alone, ICBC hit an operating profit of
5.31 billion yuan (US$660.8 million) in 2005, 650
million yuan more than a year ago, and an
intermediary business income of 672 million yuan,
up 41% year-on-year. Taking the province as a
whole, the bank realized an operating profit of
9.43 billion yuan, up 15.7% on the previous year.
Minsheng Bank, a joint stock bank, is
focusing on a niche market in Guangdong province
in line with its own conditions, extending credit
to small and medium sized private enterprises.
According to statistics provided by Minsheng
Bank's branch in Guangzhou, savings accounts of
the branch hit 34.7 billion yuan, and credit
balances 20.8 billion yuan at the end of 2005,
with the non-performing loan ratio kept at 1.84%,
the best record of any bank in the city of
Guangzhou. Financing services for small and medium
size enterprises are likely to become a focus for
Guangdong banks this year. Minsheng Bank is
applying to set up a financing department for
small and medium-sized enterprises and will launch
a pilot service in Guangzhou to offer special
petty loans below 2 million yuan to such
enterprises.
ICBC's Guangzhou branch will
continue to expand credit business to small and
medium-sized enterprises. It was reported that by
the end of 2005, the financing balance of the
branch exceeded 2.3 billion yuan, some 2 billion
yuan more than at the beginning of the year.
