Banks in China, Japan still APAC’s largest lenders: S&P

S&P’s list of the region’s 50 largest banks saw 6 Chinese and 4 Japanese banks up top, whilst Australian banks slid down.

Banks from China and Japan continue to be the largest lenders in APAC whilst the total assets of all of the region’s 50 largest banks expanded in 2021 despite the pandemic, according to data from S&P Global Market Intelligence.

Driven by China’s strong credit growth last year, the Industrial & Commercial Bank of China, China Construction Bank, Agricultural Bank of China, and Bank of China retained their top four positions, with over $17.32t in total assets combined as of 31 December 2020. Almost half, or 22 of the 50 largest banks in APAC came from China, six of which are in the top 10.

It was overall a good year for financial institutions (FIs) in the country despite the raging pandemic globally, with yuan loans to banks hitting a fresh record.

“As China pulled ahead of other major economies in recovering from the pandemic whilst pivoting toward technological self-reliance and net-zero emissions, total outstanding yuan  loans at Chinese financial institutions reached a fresh record as of 2020-end, up 12.82% from a year earlier,” the report said.

Japanese banks trailed China’s big four, with Mitsubishi UFJ Financial Group rounding up the top five followed by three other Japanese FIs. A total of nine Japanese FIs made it to the list.

There are no changes in the top 10, although there have been some switching taking place, with Sumitomo Mitsui Financial Group and Japan Post Bank swapping their sixth and seventh places, respectively.

Meanwhile, Japanese lenders reportedly increased purchases of government bonds and other financial instruments as deposits piled up. This helped offset the impact from sluggish loan growth despite an improved economic outlook, says S&P.

The biggest gainer is China's Shanghai Pudong Development Bank, with total assets rising to $1.219t and propelling it to climb to the 12th spot from 17th in the 2020 list.

New entrants to the top 50 list all come from China and Japan. Bank of Ningbo, Mebuki Financial Group and China Bohai Bank ranked 44th, 47th and 49th, respectively.

Following China and Japan in the most number of banks in the list is South Korea, which counted six banks. KB Financial Group was the highest placed at 27th, followed by the Industrial Bank of Korea at 39th.

Down south, Australia’s own big four all made the list, albeit with three out of four FIs moving down. Commonwealth Bank of Australia, Westpac Banking Corporation and National Australia Bank ranking 19th, 23rd and 25th, down from their respective slots in 2021.

Only the Australia and New Zealand Banking Group retained its spot, at 20th place.

Source: S&P Market Intelligence