Chairman of China Construction Bank talks about business ideas: Finance is a marathon, and heroes are not judged by their scale and speed

　　China News Service, Beijing, April 3: Title: Chairman of China Construction Bank talks about business ideas: Finance is a marathon, and heroes are not judged by their scale and speed.

　　Sino-Singapore Finance reporter Wang Enbo

　　On the 2nd, Zhang Jinliang, chairman of China Construction Bank, compared finance to a marathon when talking about the state-owned bank's business philosophy, emphasizing the abandonment of the traditional thinking of "heroes based on scale and speed" and preventing single, one-sided, and short-term business objectives.

China Construction Bank held its 2023 results conference in Beijing and Hong Kong on April 2

　　China Construction Bank held its 2023 results conference in Beijing and Hong Kong on the same day. The annual report shows that as of the end of 2023, its total assets were 38.32 trillion yuan; its net profit for the year was 332.46 billion yuan, a year-on-year increase of 2.34%. The non-performing loan ratio is 1.37%, and asset quality is generally stable.

　　In a complex environment, it is not easy for banks to achieve steady growth in performance. Last year, banks continued to benefit the real economy by lowering interest rates on new loans and adjusting interest rates on existing mortgages, and interest spreads continued to narrow in recent years. Actively expanding intermediary business to increase non-interest income has become an important strategy for stabilizing revenue.

Zhang Jinliang, Chairman of China Construction Bank

　　Zhang Jinliang said that non-interest income is an important component of operating income and an important yardstick for measuring the effectiveness of a bank's transformation. In 2023, CCB's non-interest income will account for 17.2% of operating income based on H shares, a year-on-year increase of 2.2 percentage points, and 19.8% based on A shares, a year-on-year increase of 1.9 percentage points.

　　He also revealed that on the basis of implementing fee reduction and profit sharing and supporting the real economy, CCB has vigorously promoted business transformation by improving comprehensive service capabilities and continued to make efforts in syndicated loans, financial consulting, wealth management, credit cards, asset management, custody, etc. Last year, the net fee and commission income was close to 120 billion yuan.

　　Entering 2024, the banking industry still faces challenges. "Finance is a marathon," Zhang Jinliang said. To be able to withstand the test of a long cycle, we must abandon the traditional thinking of "evaluating heroes based on scale and speed" and better coordinate total volume and structure, scale and efficiency, short-term and long-term, local and global, development and security, prevent single, one-sided, and short-term business goals, and achieve steady, balanced, coordinated, and sustainable development.

　　He said that in the new year, faced with an operating environment where strategic opportunities and risks and challenges coexist, CCB will adhere to quality first and efficiency first, put structural adjustment and quality and efficiency improvement in a more important position, and unswervingly promote connotative development. . To optimize the asset structure, improve the quality of liabilities, improve the quality and efficiency of capital, improve the quality of income, and improve the quality and efficiency of costs.

　　Pressure on net interest margins is a common challenge faced by the banking industry. Last year, CCB's net interest margin was 1.7%, leading among its peers.

　　Looking forward to the trend of interest rate spreads this year, CCB Chief Financial Officer Iru Rong analyzed that China's macro economy has seen promising changes in the first quarter, but the economy still needs policy care and big banks need to increase their support for the real economy. In addition, central bank officials stated that there is still room for lowering reserve requirements and interest rates, and judged that the LPR (loan market quotation rate) still has some room for downside.

　　Ikuyanagi said that in addition to optimizing and adjusting the asset-side structure and reducing the decline in asset return rates, this year CCB will put more effort into improving its "internal strength" and controlling debt costs. "Through refined management, we are confident that we will continue to lead the industry in net interest margin in 2024." (End)