China's "Big Four" state-owned banks will increase new loans by a total of about 3 trillion yuan (US$480 billion) this year, the Chinese-language China Securities Journal reports.
The interest rates set by each bank will not fluctuate in a wide range, and any bank intending to be a leader will have to look to its lending capacity and its capability to control asset quality, the journal reported, citing industry insiders.
For this year, the People's Bank of China, the nation's central bank, has approved the size of new loans for Industrial and Commercial Bank of China at about 900 billion yuan (US$145 billion), followed by China Construction Bank with 840 billion yuan (US$135 billion), Agricultural Bank of China with 700 billion yuan (US$113 billion), and Bank of China with less than 500 billion yuan (US$80 billion), the journal said.
Bank of China's lending capacity has faced greater restrictions, and this could affect its profitability this year, the report said.
ICBC's size of new loans will increase around 4% to 900 billion yuan from last year's 860 billion (US$138 billion), benefiting from its huge and stable deposits.
Construction Bank's loan size rose 11.2% to 840 billion yuan, including 730 billion yuan (US$117 billion) in renminbi loans and 110 billion yuan (US$17.7 billion) in foreign-currency loans, while Agricultural Bank's loans increased about 8% to 700 billion yuan last year, the report said.
Bank of China, after its loan size exceeded 1 trillion yuan (US$160 billion) in 2009, has slowed down to stabilize at around 600 billion yuan (US$96 billion) a year since then, but its loan size should be lower than 500 billion yuan in 2013, the report said, citing an unnamed executive from the bank.
After the authority conducted a series of new supervisory rules from this year, the capital pressure and pressure of provisions for risks are rising gradually, the loan size of state-run banks will only grow steadily, and won't suddenly rise like in 2009, the report said.
Overall, the loan size this year will be eased appropriately but the focus of this year by the regulator will be on risk control, the journal said.
Regarding actually approved loans last year, three of the big four completed the goals set early last year, but only Bank of China approved loans of 430 billion (US$69 billion), lower than market expectations, the report said.
The poorer-than-expected performance by Bank of China was because of the restriction of its loan-to-deposit ratio. As of the end of last year, the bank's loan-to-deposit ratio stood around 72%-73%, approaching the supervisory authority's red light at 75%, indicating the bank's loan increase will have to rely on the size of its deposits, the report said, citing an unidentified industry insider.
In 2012, although the overall liquidity was quite loose, all banks had worked hard to keep their deposits by giving clients all kinds of preferential treatment, the report said.