In 2020, many banks contracted their strategies in the field of credit cards, issuing and credit were more cautious than in previous years, and the non-performing rate also rose one after another due to the objective environment. A year later, in 2021, has the bank credit card business “recovered”?
The 21st Century Business Herald reporter sorted out the annual reports of 13 listed large state-owned banks and joint-stock banks and found that the single digit growth of card issuance of most banks was flat, while the balance of non-performing loans and non-performing rate of most banks decreased, indicating that the asset quality of credit cards has improved after the continuous strategic contraction.
Since Shanghai Pudong Development Bank Co.Ltd(600000) and Hua Xia Bank Co.Limited(600015) have not yet announced the complete performance in 2021, the banks included in the comparison include five state-owned banks of industry, agriculture, China, construction and communications, Postal Savings Bank Of China Co.Ltd(601658) , as well as seven joint-stock banks of China Merchants Bank, Societe Generale, CITIC, Ping An, Everbright, Minsheng and Zheshang.
most banks’ card issuance increased by no more than 5%
In 2020, due to objective environmental factors, offline transactions of credit cards decreased, and banks also adjusted the rhythm of credit card issuance. In 2021, the pace of slow growth continued, and the cumulative issuance volume of 7 of the 13 banks did not increase by more than 5% compared with the beginning of the year.
Those who still maintain a growth rate of more than 5% are Postal Savings Bank Of China Co.Ltd(601658) (12.93%), China Citic Bank Corporation Limited(601998) (9.4%), Ping An Bank Co.Ltd(000001) (9.2%), China Everbright Bank Company Limited Co.Ltd(601818) (8.5%), Agricultural Bank Of China Limited(601288) (7.69%), Industrial Bank Co.Ltd(601166) (5.1%).
The lowest growth rate of card issuance is ICBC among the major banks, with a growth rate of 1.87%; However, its cumulative issuance volume was 163 million, still ranking first among the 13 banks. China Construction Bank, Bank of China and Bank of communications also had a growth rate of less than 3% over the beginning of the year, and the growth rate of credit card issuance of China Merchants Bank, often known as the “king of retail”, was not much, at 2.9%.
From the data of cumulative card issuance, the top five are ICBC, China Construction Bank, Agricultural Bank of China, Bank of China and China Merchants Bank it is worth noting that China Citic Bank Corporation Limited(601998) became the second joint-stock bank after China Merchants Bank to realize “100 million level” card issuance. At present, there are only two joint-stock banks breaking 100 million
In terms of consumption amount, China Merchants Bank is the only one with more than 4 trillion yuan. Ping An, China Construction Bank and Bank of communications are among 3 trillion yuan to 4 trillion yuan. CITIC, Everbright, Xingye, Minsheng, ICBC and ABC are all between 2 trillion yuan and 3 trillion yuan. Bank of China and Postal Savings Bank Of China Co.Ltd(601658) are between 1 trillion yuan and 2 trillion yuan, and China Zheshang Bank Co.Ltd(601916) is less than 1 trillion yuan.
It is worth noting that the consumption amount of 4 of the 13 banks decreased compared with the previous year, including CCB, ICBC, Bank of China and China Zheshang Bank Co.Ltd(601916) , of which China Zheshang Bank Co.Ltd(601916) decreased by 15.45%. Three companies achieved double-digit growth in consumption, namely China Minsheng Banking Corp.Ltd(600016) , China Citic Bank Corporation Limited(601998) and Postal Savings Bank Of China Co.Ltd(601658) , all exceeding 14%. China Merchants Bank increased by 9.73%, and Ping An Bank Co.Ltd(000001) increased by 9.8%.
From the perspective of overdraft balance, only two banks exceeded 800 billion yuan, China Construction Bank and China Merchants Bank. The highest growth rate compared with the end of last year was Postal Savings Bank Of China Co.Ltd(601658) , an increase of more than 20%. In addition, Ping An Bank Co.Ltd(000001) , ABC and China Merchants Bank all achieved double-digit growth.
In response to the 21st Century Business Herald’s inquiry about the credit card business, Bank Of Communications Co.Ltd(601328) replied that after two or three years of business adjustment, the credit card business has gradually achieved restorative growth since last year. Since the beginning of the year, the development of credit card business has continued to be good, and the growth rate of consumption and card loan balance is faster than that of the same period of last year. In 2022, we will strive to expand the scale of credit card consumption, and the loan increment is expected to be higher than that of last year.
In its annual report, China Merchants Bank said that looking forward to 2022, in view of the short-term impact caused by the evolution of the epidemic outside China and the factors such as the institutions in the same industry further accelerating the identification and repayment of the risk of CO debt, it is expected that there will be some pressure on the short-term risk control of consumer credit business.
A few banks disclosed the income of credit card business.
The credit card business income of China Merchants Bank was 86.754 billion yuan, an increase of 5.13% over the end of the previous year. Among them, the interest income was 59.645 billion yuan, an increase of 5.87% over the end of the previous year; Non interest income from credit cards was 27.109 billion yuan, an increase of 3.57% over the end of the previous year. Everbright’s credit card business revenue was 44.150 billion yuan, down 2.71% from the end of the previous year China Zheshang Bank Co.Ltd(601916) credit card business income was 1.185 billion yuan, down 11.83% from the end of last year.
risk indicators gradually recovered
The performance of the 2020 annual report shows that the asset quality of credit card business of most banks has declined, and the total amount of non-performing assets and non-performing rate have increased. This situation was reversed in 2021.
According to the reporter’s sorting, among the 10 banks that released the bad credit card data, only 2 had a slight increase in the bad rate, and the other 8 had a decrease in the bad rate. Among them, the non-performing rate of Agricultural Bank Of China Limited(601288) , China Citic Bank Corporation Limited(601998) decreased by more than 0.5 percentage points. In addition, the “outstanding students” with the lowest non-performing rate in 2021 are Agricultural Bank of China (0.99%), China Construction Bank (1.33%) and China Merchants Bank (1.65%) China Minsheng Banking Corp.Ltd(600016) defective rate is the highest, 2.95%, but it has decreased by 0.33% compared with the previous year.
Zhu Jiangtao, vice president of China Merchants Bank, said at the performance report meeting on the non-performing rate that according to the regulatory requirements, the identification of the overdue time point of the credit card is set as the repayment deadline of this bill from the next bill date, about 8 days in advance on average. After restoring such factors, ” whether personal loan or credit card, pay attention to (loan) and overdue (loan) Compared with the beginning of the year, the turnover rate of the company decreased, and the real risk showed a downward trend. From the early asset quality indicators of credit cards, the risk indicators have recovered to the pre epidemic level . There will be some changes in the overdue scale of credit cards this year, mainly because after the time point of our overdue identification changes, the overdue scale of credit cards may fluctuate between months due to factors such as the distribution of large and small months and holidays. “
Industrial Bank Co.Ltd(601166) showed a rebound of 0.13 percentage points in the non-performing rate of credit cards. Zou Jimin, general manager of risk management department, said at the performance report meeting, “according to our resources, we can achieve the ‘double reduction’ of bad credit cards. The reasons why we take the initiative to slow down the disposal are as follows: first, in order to support covid-19 epidemic prevention and control and protect consumers’ rights and interests, we appropriately slow down the disposal of customers affected by the epidemic and encourage customers to take the initiative to repay after the epidemic is alleviated.
Second, considering that the recognition standard of overdue credit cards tends to be strict in 2021, it is necessary to give customers a certain adaptation period. “
He provided another set of data: by the end of 2021, Industrial Bank Co.Ltd(601166) credit card non-performing loan generation rate and new non-performing amount had decreased significantly year-on-year. In 2021, the generation rate of non-performing credit card loans was 4.17%, a year-on-year decrease of 1.82 percentage points; The new non-performing amount was 17.6 billion yuan, a year-on-year decrease of 5.1 billion yuan or 22.43%. Therefore, he said that the overall risk of Industrial Bank Co.Ltd(601166) credit card is controllable, and the asset quality has not changed to the good trend. Looking forward to 2022, there is still a large growth space for consumption after the epidemic is alleviated, and the quality control of credit card assets is facing new opportunities and challengesp align=”center”>
focus on high-quality consumer groups
Wang Jianzhong, vice president of China Merchants Bank, said at the performance meeting that credit cards adhere to strict risk control in the short term, adjust asset form in the medium term and adjust customer base in the long term. The whole strategy achieved very good results last year and the year before last. The quality of credit card customers will be greatly adjusted, and a low price policy will be implemented for some customers, with an annual interest rate of 6% to 9%; Increased the launch of order products, such as car staging.
China Minsheng Banking Corp.Ltd(600016) Vice President Lin Yunshan also said at the performance meeting that the operation options of key customer groups have been adjusted according to the external environment. In terms of credit cards, we pay more attention to customers with stable consumption, including target customers such as millennial customers, female customers and highly educated customers. We also pay more attention to the operation of customers with settlement scenarios. The proportion of customers with stable consumption reached 88%, an increase of 2.4 percentage points over the previous year.
China Everbright Bank Company Limited Co.Ltd(601818) vice president Qi Ye also pointed out that Everbright further focused on high-quality consumer groups, iteratively upgraded key products, improved the card environment for online Internet platforms and offline consumption scenes, and improved the quality and efficiency of customers. Among the newly introduced customers in 2021, high-quality customers accounted for 65%, significantly higher than that at the beginning of the year; Online trading volume increased by more than 40% year-on-year.
He also proposed to provide high-quality credit card services for new citizens and enhance customer value contribution. Focus on the introduction of young consumer high-quality customers, improve the construction of products, scenes, brands and touch of young customers, and increase the proportion of young customers.
