Shanghai's banking industry reported a combined pre-tax profit
growth of 66.2 percent in 2007 and regulators urged more innovation
to cut the levy on lending.
The industry raked in a combined pre-tax profit of 66.99 billion
yuan (US$.9.32 billion) last year as lending and personal wealth
management products boomed, the Shanghai headquarters of the
People's Bank of China said.
Chinese banks reported a profit increase of 68.7 percent last
year, outpacing their overseas rivals' 32.4-percent rise, the
central bank said.
Banks should quicken the pace of innovation and offer more new
products and new services to diversify profitability, the central
bank said. They should boost efforts to cut the proportion of
lending assets and increase non-loan business and non-interest rate
income, the statement said.
At present, about 70 percent of banks' income originated from
their lending business while overseas banks earned 50 percent of
their revenue from loans.
Last year's booming stock market also offered banks a platform
to sell related financial products, such as those bidding for new
shares and others under the qualified domestic institutional
investors scheme where banks pool clients' money to invest in
overseas capital markets.
The central bank also said that while lenders in Shanghai should
follow a tight monetary policy by capping their lending scale, they
should also at the same time grant loans to small- and medium-size
players and firms engaged in environmental protection.
(Shanghai Daily February 13, 2008)
