Industrial and Commercial Bank of China
From Wikipedia, the free encyclopedia
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| Type | Public company SEHK: 1398, SSE: 601398 |
|---|---|
| Founded | 1984 |
| Headquarters |  Xicheng District, Beijing, PRC |
| Key people | Jiang Jianqing, Chairman / Executive Director Yang Kaisheng, Vice Chairman / Executive Director / President |
| Industry | Finance |
| Products | Financial services |
| Revenue | RMB 137.858 Billion (2005) or US$20.188b[1][2] |
| Operating income | ▲ RMB 256.029 billion (2007)[3] |
| Net income | ▲ RMB224.460 billion or US$32.870b(2007)[3] |
| Total assets | RMB 9.8 trillion (2008)[4] |
| Employees | 351,448 (2006)[3] |
| Website | (English) www.icbc.com.cn |
Industrial and Commercial Bank of China (ICBC) (simplified Chinese: 中国工商银行; traditional Chinese: 中國工商銀行; pinyin: Zhōngguó Gōngshāng Yínháng, more commonly just 工行 Gōngháng) is the largest bank in the world.[5] It is one of China's "Big Four" state-owned commercial banks (the other three being the Bank of China, Agricultural Bank of China, and China Construction Bank). It is the largest bank in the world in terms of market value and one of the world's top ten banks by assets.
It was founded as a limited company on 1 January 1984. As of 2008, it had assets of RMB 9.8 trillion (US$1.4 trillion), with over 18,000 outlets including 106 overseas branches and agents globally.[6] In July 2007, with a market capitalization of US$254 billion, it became the world's most valuable bank after a surge in its share price, overtaking Citigroup.[7]
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[edit] Events in 2005
The bank's Hong Kong operations are listed under the name ICBC Asia. It has purchased the Hong Kong subsidiary of Fortis Bank and rebranded it under its own name on 10 October 2005.
[edit] Events in 2006
In the runup to its planned initial public offering, on 28 April 2006, three "strategic investors" injected US$3.7 billion into ICBC :
- Goldman Sachs purchased a 5.75% stake for US$2.6 billion, the largest sum Goldman Sachs has ever invested [1].
- Dresdner Bank (a wholly owned subsidiary of Commerzbank) invested US$1 billion [2].
- American Express invested US$200 million [3].
[edit] World's Largest IPO
ICBC was simultaneously listed on both the Hong Kong Stock Exchange and Shanghai Stock Exchange on 27 October 2006. It was the world's largest IPO to date, surpassing the previous record US$18.4 billion IPO by Japan's NTT DoCoMo in 1998.[4] China’s largest commercial bank is also the first company to debut simultaneously on both the Hong Kong and Shanghai stock exchanges.
ICBC raised at least US$14 billion in Hong Kong (H-shares) and another US$5.1 billion in Shanghai (A-shares). Due to heavy subscriptions, the greenshoe (i.e. over-allotment) placements were exercised and ICBC's take rose to US$21.9 billion (17% of ICBC's market value before the IPO), divided in US$16 billion in Hong Kong and US$5.9 billion in Shanghai. Following the global offering, the free float of shares was 22.14% of the market capitalization.
At the end of its first day of trading, the bank’s shares closed up almost 15% at HK$3.52 in Hong Kong, compared with the listing price of HK$3.07, which was set at the top of the indicative range due to the strong demand. According to Bloomberg, ICBC’s market capitalisation at the end of trade based on its Hong Kong shares was US$156.3 billion, making it the world’s fifth largest bank, just behind JPMorgan Chase. Meanwhile, ICBC’s Shanghai-listed A-shares recorded more modest gains and ended up 5.1% from the offering price of RMB 3.12.
[edit] Events in 2008
In August 2008, ICBC became the second Chinese bank since 1991 to gain federal approval to establish a branch in New York City.[8]
At the 2008 ALB China Law Awards[9], ICBC was crowned:
- In-House of the Year - Banking & Financial Services In-House Team of the Year
- In-House of the Year - China In-House Team of the Year
Industrial and Commercial Bank of China Limited (ICBC) Announces 2008 Annual Results: In 2008, ICBC strengthened its position as the world's largest bank by market value and became the most profitable bank in the world[10].
[edit] Basic figures
ICBC has 2.5 million corporate customers and 150 million individual customers. [11] In 2005, net profit was up 12.4% to RMB 33.7 billion, and the total loan balance was RMB 3,289.5 billion. Total liabilities are RMB 6,196.2 billion, up 11.2%. Delinquent or non-performing loans (NPL) total RMB 154.4 billion, a significant reduction although the figures are widely regarded as being somewhat higher than officially stated. It has an NPL ratio of 4.69% and a capital adequacy ratio of 9.89%.
[edit] Loans by industry (2005)
In millions of Chinese RMB (Yuan):
- Manufacturing: 662,376, 20.1% (28.7% in 2004)
- Transportation, storage, postage & telecommunications: 367,371, 11.2% (10.2% in 2004)
- Power, gas and water: 281,179, 8.6% (7.0% in 2004)
- Retail and wholesale, catering: 265,906, 8.1% (6.9% in 2004)
- Property development: 194,024, 5.9%, (5.6% in 2004)
- Social service organization: 103,070, 3.1%, (3.2% in 2004)
- Construction: 89,666, 2.7%, (2.1% in 2004)
- Other industries: 313,804, 9.5%, (12.1% in 2004)
- Discounted bills: 392,717, 11.9%, (8.4% in 2004)
- Personal loans: 515,042, 15.7%, (13.1% in 2004)
- Overseas business:104,398, 3.2%, (2.7% in 2004)
Total: 3,289,553
[edit] Loan collateral
- Secured by mortgages: 34.1%
- Secured by other collateral: 22.1%
- Guaranteed loans: 23.3%
- Unsecured loans: 20.5%
[edit] Non-performing loans
At the end of 2004, 19.1% of ICBC's portfolio consisted of non-performing loans.[5] In order to clean up ICBC's balance sheet and prepare it for overseas listing, the Chinese government orchestrated a series of capital injections, asset transfers, and government-subsidised bad loan disposals that eventually cost more than US$162 billion.[6] This included an approval for a cash injection of US$15 billion (financed from China's massive foreign exchange reserves) on 28 April 2005.[7] The Beijing-based state company, China Huarong, helped ICBC dispose of its bad loans. As the 2005 annual report records, just under 5% of loans are classified as non-performing, in comparison with the majority of western banks who have lower NPL ratios (US commercial banks around 1%) [8].
[edit] Legal issues
- February 2005: A Hunan branch manager was convicted of bribery and imprisoned for 19 years.
- April 2006: An assistant branch manager in Guangdong found guilty on similar charges and jailed for 12 years.
- January 2009: A 23 minute (2 January, 01:52 a.m. and 2:15 a.m. local time) computer glitch caused the trading system to quote gold at six times the market price. ICBC cancelled all purchases and transactions from the time period.
[edit] Connection with other financial institution
- It holds 20% shares of Standard Bank of South Africa
[edit] See also
[edit] References
- ^ http://www.google.com/search?q=Industrial+and+Commercial+Bank+of+China+revenue
- ^ http://www.google.com/search?q=137858+RMB+in+USD
- ^ a b c 30942 (eng).indb
- ^ http://www.icbc.com.cn/icbc/icbc%20news/icbc%20and%20bea%20agreed%20on%20the%20sale%20and%20purchase%20of%20the%20bank%20of%20east%20asia%20(canada)%20and%20icea%20finance%20hold.htm ICBC and BEA agreed on the Sale and Purchase of The Bank of East Asia (Canada) and ICEA Finance Holdings Limited
- ^ http://www.ft.com/cms/s/0/ea450788-1573-11de-b9a9-0000779fd2ac.html
- ^ China’s biggest bank goes to market, Financial Times
- ^ China ICBC tops Citigroup as world's biggest bank
- ^ http://www.federalreserve.gov/newsevents/press/orders/orders20080805a1.pdf
- ^ www.legalbusinessonline.com.au
- ^ http://www.icbc.com.cn/icbc/icbc%20news/industrial%20and%20commercial%20bank%20of%20china%20limited%20announces%202008%20annual%20results.htm
- ^ http://www.chinadaily.com.cn/china/2006-09/27/content_698025.htm.
[edit] External links
- (English) 2005 Annual Report
- (Chinese) Industrial and Commercial Bank of China
- (English) Industrial and Commercial Bank of China
