CDB sixth most profitable Chinese bank
April 30, 2012 Category Finance, Weekly
China Development Bank (CDB), the financing arm for big infrastructure projects, posted a 22.9% rise in net profit last year to CNY45.6 billion. The bank’s net profit figure makes CDB the sixth most profitable bank in China, behind the five biggest banks deemed “systemically important” by regulators, with earnings boosted by an increase in its financing margin. CDB said its non-performing loan ratio dropped to 0.4% at the end of 2011 from 0.68% from a year ago. CDB, which has a sovereign status in the onshore bond market, had a net interest rate gap of 204 basis points in 2011, up from 185 basis points in 2010, as it raised low-cost funds from the interbank system and lent heavily to government-backed projects such as roads and railways. CDB is the second-largest bond issuer in China’s interbank market, next only to the treasury, accounting for 20.8% of total bonds issued last year. CDB, with CNY6.25 trillion in assets, is regarded as a policy bank that subordinates profitability to serving government interests, despite plans to make it a commercial bank. The bank is owned by the Ministry of Finance with 50.18%, Central Huijin Investment at 47.63%, and the national pension fund with 2.19%.
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