Bank of Chengdu Co., Ltd.: history, ownership, mission, how it works & makes money

A Brief History of Bank of Chengdu Co., Ltd.

Bank of Chengdu Co., Ltd. was founded in 1996, in Chengdu, Sichuan Province, China. It began operations as a city commercial bank and has since evolved into a significant player within the regional banking sector. The bank was established to meet the financial needs of local enterprises and individual customers, providing a range of banking services.

In 2010, the Bank of Chengdu initiated its initial public offering (IPO), listing on the Shenzhen Stock Exchange under the ticker symbol “*002261*.” The IPO raised approximately **RMB 1.4 billion** (around **USD 200 million** at the time), boosting its capital base to support expansion and improved service offerings.

By the end of 2019, Bank of Chengdu reported total assets of **RMB 555.38 billion** (approximately **USD 79 billion**) and net profit attributable to shareholders of **RMB 4.22 billion** (around **USD 600 million**). The bank's profitability indicators, such as Return on Assets (ROA) and Return on Equity (ROE), stood at **0.68%** and **10.47%**, respectively.

The bank has strategically expanded its branch network. As of September 2023, Bank of Chengdu had **200** branches across the Chengdu region, contributing to a robust customer base exceeding **8 million** clients. The bank's focus has been on servicing small and medium-sized enterprises (SMEs), reflecting its commitment to fostering local economic development.

In terms of asset quality, Bank of Chengdu reported a non-performing loan (NPL) ratio of **1.58%** as of mid-2023, maintaining stability in its loan portfolio despite the challenges posed by economic fluctuations.

The bank has made significant investments in technology and digital banking services. By 2022, it launched an upgraded mobile banking app that recorded over **3 million** active users, reflecting a growing trend towards digital financial services among consumers.

Additionally, the Bank of Chengdu has been recognized for its corporate social responsibility (CSR) initiatives. In 2021, they committed **RMB 100 million** (approximately **USD 14 million**) to support local environmental and educational projects, aiming to contribute positively to the communities it serves.

A Who Owns Bank of Chengdu Co., Ltd.

Bank of Chengdu Co., Ltd., established in 1996, is a publicly traded bank headquartered in Chengdu, Sichuan Province, China. As of the latest data from 2023, the ownership structure consists of various stakeholders, with significant proportions held by financial institutions and state-owned enterprises.

According to the company's 2022 annual report, the following shareholders held the largest stakes:

As of June 30, 2023, Bank of Chengdu reported total assets amounting to approximately ¥521.1 billion (approximately $73.3 billion), showcasing the financial strength and capacity of the institution. The bank's net profit for the first half of 2023 stood at ¥2.57 billion (approximately $363 million), representing an increase of 12.5% year-over-year.

In terms of market performance, Bank of Chengdu's stock price closed at ¥9.15 on September 30, 2023, reflecting a year-to-date change of +4.8%. The bank has a market capitalization of approximately ¥37.5 billion (about $5.3 billion).

The governance of Bank of Chengdu is overseen by a Board of Directors that comprises a mix of government-appointed and independent directors, ensuring a diverse perspective in strategic decision-making. The bank's current Chairman is Xu Jianhong, who has been in this role since 2020.

Overall, Bank of Chengdu's ownership reflects a blend of state influence and public investment, with significant participation from both institutional and individual investors, positioning the bank for continued growth in the competitive Chinese banking sector.

Bank of Chengdu Co., Ltd. Mission Statement

The mission statement of Bank of Chengdu Co., Ltd. emphasizes its commitment to providing comprehensive financial services while supporting regional economic development. The bank strives to be a leading provider of innovative financial solutions, catering to both individual and corporate clients.

As of June 30, 2023, Bank of Chengdu reported total assets of approximately ¥622.3 billion (around $90.7 billion), reflecting its substantial growth in the competitive banking sector. The bank is focused on increasing customer satisfaction by delivering tailored financial products and enhancing service quality.

In 2022, Bank of Chengdu achieved a net profit of ¥4.5 billion (approximately $650 million), demonstrating a robust return on equity of 12.8%. This performance aligns with its mission to generate sustainable value for shareholders while contributing positively to the communities it serves.

Bank of Chengdu also focuses on technological innovation as part of its mission. In recent years, it has invested significantly in digital banking solutions, with an increase in online banking transactions by 35% year-over-year as of 2022. The bank aims to leverage technology to streamline operations and improve customer engagement.

The bank’s mission includes fostering sustainable development within the region. It has committed to financing projects that support environmental sustainability and social responsibility. In 2023, Bank of Chengdu allocated ¥1.2 billion towards green financing initiatives, reinforcing its dedication to responsible banking practices.

The strategic focus of Bank of Chengdu can be seen in its targeted expansion efforts. Over the past year, it has opened 10 new branches in underserved urban areas, contributing to financial inclusion and accessibility for customers. The bank aims to reach 1 million new customers by the end of 2024 through these efforts.

In summary, the mission of Bank of Chengdu Co., Ltd. is articulated through its financial performance metrics, commitment to customer service, technological advancements, and dedication to sustainable practices—all of which underpin its role as a key player in the regional financial landscape.

How Bank of Chengdu Co., Ltd. Works

Bank of Chengdu Co., Ltd., based in Chengdu, China, operates primarily as a commercial bank providing various financial services to both individual and corporate clients. As of June 30, 2023, the bank reported total assets of approximately ¥1,275.23 billion (around $189.9 billion). The institution focuses on retail banking, corporate banking, and financial market operations, contributing significantly to its revenue streams.

The bank's revenue for the first half of 2023 reached approximately ¥25.57 billion (about $3.82 billion), a consistent increase from the previous year’s ¥23.08 billion. The net profit attributable to shareholders during the same period was reported at ¥8.76 billion (roughly $1.3 billion), representing a year-on-year increase of 10.4%.

Business Segments

Bank of Chengdu operates through several distinct segments, including:

• Retail Banking: Providing services such as personal loans, mortgages, savings accounts, and credit cards. Retail banking accounted for approximately 54% of total revenue in 2022.
• Corporate Banking: Offering loans, treasury services, and cash management solutions to companies. In 2022, this segment contributed around 39% of overall revenue.
• Investment Banking: Involves underwriting and advisory services. Investment banking revenues accounted for about 7% of total revenues in 2022.

Financial Performance Overview

As of Q2 2023, the bank’s capital adequacy ratio stood at 13.45%, above the regulatory minimum of 10.5%. The non-performing loan (NPL) ratio was recorded at 1.48%, reflecting effective risk management practices compared to the industry average of 1.8%.

Key Financial Metrics

Loan and Deposit Growth

The bank reported robust loan growth of 12% year-over-year, reaching approximately ¥780 billion as of the end of Q2 2023. Deposit levels have similarly risen, with total deposits amounting to ¥1,015 billion, reflecting a growth rate of 9% compared to the previous year.

Market Position

Bank of Chengdu is listed on the Shanghai Stock Exchange under the ticker symbol 601838. As of October 2023, the share price stood at approximately ¥10.53, with a market capitalization of about ¥200 billion (around $30 billion), making it one of the leading regional banks in China.

The bank’s price-to-earnings (P/E) ratio is currently around 12.6, which is competitive compared to the industry average of 13.4, indicating solid valuation relative to earnings.

How Bank of Chengdu Co., Ltd. Makes Money

Bank of Chengdu Co., Ltd. primarily generates revenue through several key business segments, focusing on interest income, fee-based services, and investment income.

Interest Income

The bank earns a significant portion of its income from interest on loans. As of December 31, 2022, Bank of Chengdu reported a total loan portfolio of approximately ¥300 billion. The net interest income for the year reached ¥6 billion, reflecting a net interest margin of 2.1%.

Fee-Based Services

In addition to interest income, Bank of Chengdu derives revenue from various fee-based services. In 2022, the bank recorded non-interest income of approximately ¥1.5 billion. The main sources of fee income include:

• Transaction fees: ¥700 million
• Advisory services: ¥400 million
• Wealth management services: ¥300 million

Investment Income

The bank also invests in various financial instruments. As of the end of 2022, Bank of Chengdu held investment securities totaling approximately ¥50 billion. The investment income generated from these securities amounted to ¥1.2 billion for the year.

Operating Expenses

To provide context around profitability, Bank of Chengdu's total operating expenses for 2022 were reported at approximately ¥4 billion, resulting in an operating profit of ¥4.5 billion. The cost-to-income ratio stood at 47.5%.

Financial Performance Overview

Conclusion

Bank of Chengdu Co., Ltd.'s multifaceted approach to revenue generation, combining traditional banking practices with modern financial services, facilitates its profitability and stability in the competitive banking landscape.