According to the 2017 list of "Top 1000 World Banks" released by the British magazine, The Banker, IB was ranked the 28th place in terms of tier 1 capital, ranked the 30th place in terms of the total asset, up by 4 and 3 places respectively, representing that IB was already one of the top 30 best global banks. It is noteworthy that IB was ranked top in terms of the income-cost ratio among top 50 global banks.
The "Top 1000 World Banks” released by The Banker, an authoritative British magazine well known by the world, has a history of more than 40 years, and is regarded as the most representative benchmark to evaluate the comprehensive strength of global banks. The list shows that the China’s banking industry has reached another new height with totally 126 banks on the list, second only to the USA, and took three seats from top five global banks.
The ever-growing comprehensive strength of IB has shown significant climbing on the list. In recent years, IB has maintained its strategic willpower, actively adapted itself to the New Normal and changes, accelerated the progress of upgrade and transformation, and seized market opportunities in a sensitive way. IB has achieved outstanding results in green finance, pension finance, financial market business and a line of featured and advantageous sectors, with its comprehensive strength and market position being secured and enhanced. By the end of 2016, the total assets of IB had exceeded RMB 6 trillion and reached RMB 6.09 trillion, with a YOY growth of 14.85%, remaining No. 1 among all domestic shareholding banks; the net profit reached RMB 53.850 billion with a YOY growth of 7.26%. The synergistic effect of a modern comprehensive financial group primarily focusing on banking has fully functioned. All subsidiaries totally contributed to the profit of RMB 2.876 billion. The intermediate business income retained from all kinds of linkage business throughout the year reached RMB 3.1 billion.
IB is always doing a great job in the industry regarding the income-cost ratio. The list shows that the income-cost ratio of IB in 2016 is only 23.18%, retaking its No. 1 place from the 2nd place Top 50 Global Banks last year. It highlights the excellent operation efficiency and cost control ability of IB under the New Economic Normal. On one hand, IB has taken the initiative to adjust and optimize business structure, speed up the pace of constructing a “settlement-based, investment-based and transaction-based” bank. The handling expense and commissions have increased by 15.15%, accounting for 24.63% of the total operation income, up by 2.87%. On the other hand, the input to the infrastructure construction and business transformation has been intensified; outlets have been made smart, small and community-based, and costs have been reasonably controlled. According to the data, the income-cost ratio of IB was reduced from 32.91% in 2010 to 23.18% in 2016, maintaining excellent among domestic banks.
The “Top 1000 World Banks” mainly considers the tier 1 capital of banks, which is a very important measurement for the large-scaled borrowing and risk tolerance capacity of banks. Without the supplementary tier 1 capital from other sources, IB further strengthened its inner generation of capital by increasing the profitability and increasing the internal accumulation. By the end of 2016, the adequacy ratio of IB's core tier 1 capital was raised from 8.43% to 8.55%, the adequacy ratio of tier 1 capital raised from 9.19% to 9.23%, maintaining its relatively high risk tolerance and hedging ability.
Meanwhile, IB has furthered the intensive capital management with the key on “light capital and light asset” business. At the end of 2016, the risk weigh of all assets was only 62.48%, down by 2.21% compared with 2015. The investment banking business, asset management finance, asset custody, interbank platform, FICC (Fixed Income Currencies & Commodities) remained their leading positions among the peers.
By the end of 2016, the underwriting scale of debt financing instruments by non-financial enterprises had reached RMB 407.9 billion, topping all shareholding banks for 5 consecutive years; the year-end balance of asset management business had been RMB 1.38 trillion and gradually turning from expected earning product to net value product; the income of intermediate wealth management business had been increased by 29.61%; the inter-bank platform had sold financial products totaling RMB 1.9223 trillion with the settled amount exceeding RMB 3 trillion; the asset custody scale had reached RMB 9.4 trillion, up by 30.89% compared with the beginning of the year, ranking top 3 in the industry; as for financial market business, especially the FICC business, IB has strengthened its advantages as the market maker and linked RMB 43.6 billion of fixed income products such as investment bonds and asset securization with a YOY growth of 246%. The transaction of agency forex derivatives amounted to RMB 243.7 billion with a YOY growth of 36%. The transaction of agency precious metal business amounted to RMB 282.3 billion with a YOY growth of 31%. The lightweight transformation based on a “settlement-based, investment-based and transaction-based” bank takes shape.
Based on the fine start of the Thirteenth Five Year Plan in 2016 and according to the planning and development requirements put forward in the new round of Five Year Plan to strengthen new power for transformation and development, IB officially launched a new round of organizational system and structure reform this March with an aim to further enhance professionalism, separate account departments and product departments, traditional business and new business, reduce management levels, increase response speed and service efficiency.
Tao Yiping, the president of IB, expressed that this reform aimed to change the business mode from heavy asset and capital into light asset and capital; from an agency of credit and capital to an agency of information and capital; from holding assets to managing and transacting assets; from financing to knowledge leveraging; from a single market to the entire financial market. By continuously optimizing business structure, revenue structure, business mode and profitability mode, efforts were made to achieve more sustainable development of IB.