The banking industry in China is booming rapidly, being pushed by various factors like healthy mortgage and personal loans industry, growing industrial base, advanced measures adopted by banks etc.
The banking industry in China is growing at a fast pace and has been helping the financial industry to grow since the last five years. The growth in banking industry is due to the various reforms introduced by the central government, according to China’s Communist Party in a document that was issued at the 17th Party Congress organized during October 10 to 15 2007. The Forbes published this news.
According to the document, the industry’s property increased to 43.95 Trillion Yuan (around US$ 5.85 Trillion) at 2006 end, a 79.5% rise from 2002. In China, there were around 20,000 legal banking institutions, 104 security companies, and 68 licensed foreign security institutions at 2006 end. The non-performing loans (NPLs) were 6.54% during June 2007 end as compared to 23.6% at 2002 end.
The growth in China’s bank industry was also helped by mortgage and personal loans industry. The progress made in the competitive insurance industry (five insurers appeared on the list of offshore as well as domestic markets) also helped the banking sector to grow.
Even the entire main bank holding enterprises in China wants to have a share in the country’s banking industry. The increasing consumer incomes, growing industrial base, expanding middle class base, as well as wealthy households open up new business for those bank-holding enterprises. The people are also getting lured by a number of other factors adopted by banking industries, such as net banking, phone banking, smartcards and so on.
The government of China, in order to grow the already flourishing financial and banking sector, has taken measures to increase the capital account liberalization, discourage the flow of hot money in China, widen its investment in foreign countries, and also reform the listed enterprises’ non-tradable shares.
A research analyst at RNCOS said, “Growth in China’s financial industry is the main reason that pushed the boost in the country’s banking industry. The strong economic growth has led the growth of banking industry in the country’s mainland. Moreover, the government is also working to sustain the banking industry’s boom. And the advanced technologies adopted for the customers by the bank are also sure to further the boost in this sector.”
Related Market Research Reports:
Philippines Banking Sector Analysis
Sharia Banking System in Indonesia
South African Banking Sector Analysis
