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Banks: Economic expansion drives bank rebound

Brands also build presence overseas

 

Banks enjoyed a better year, rising 13 percent after declining 6 percent a year ago, when all but two bank brands in the BrandZ™ Top 100 declined in value. In this year’s BrandZ™ China Top 100 report, every bank brand except one increased in value.

 

Several factors prompted the rebound, including demand for home mortgages and improved commercial loan performance as key industries strengthened. In addition, many state-owned banks implemented initiatives to improve customer service and strengthen their competitiveness, especially against fintech challengers.

 

China’s four largest banks, all state-owned, reported strong profits for the first three quarters of 2017, driven primarily by strong growth in net interest income resulting from improved margins and strong economic growth. These banks—Industrial and Commercial Bank of China (ICBC), China Construction Bank, Agricultural Bank of China, and Bank of China—funded government initiatives to grow the real economy.

 

ICBC, for example, financed infrastructure construction, poverty reduction, and small businesses. In a collaboration aimed at solving the problem of excess housing inventory, several real estate companies worked with major banks, such as Bank of China, China Construction Bank, and China CITIC to develop quality rental housing.

 

China’s largest banks also increased their overseas presence to serve the financial services needs of Chinese companies expanding abroad to implement the government’s Belt and Road strategy for exerting Chinese soft power.

 

The only market-driven bank in the BrandZ™ China Top 100, China Minsheng Bank, declined in value, in part because of lower income from fees and deposits. A year ago, China Minsheng Bank was one of only two banks in the BrandZ™ China Top 100 to rise in value.