In Zhejiang, a key economic province, the banking sector remains a focal point for industry observers. The region hosts prominent financial institutions such as Bank of Ningbo, CZBANK, and Bank of Hangzhou, which have long competed for the title of "Zhejiang's top bank," symbolizing excellence in performance and service both locally and nationally.
Amid evolving economic conditions, these banks have adopted distinct strategies in digital transformation and retail finance innovation, showcasing varied competitiveness and growth potential. A comparative analysis of their H1 2024 core metrics and personal loan trends over the past four years reveals their divergent trajectories.
**Performance Comparison: CZBANK Leads in Assets, Bank of Hanghou Tops Profit Growth, Bank of Ningbo Dominates Market Cap**
With Bank of Ningbo’s H1 2024 report released on August 29, the financial standings of all three banks are now clear.
- **Total Assets**: CZBANK retains the top spot at RMB 3.25 trillion (+3.27% YoY), while Bank of Ningbo grew the fastest (+11.88% YoY) to RMB 3.03 trillion. Bank of Hangzhou, though smaller (RMB 1.98 trillion), posted solid growth (+7.79% YoY). - **Revenue**: CZBANK led with RMB 352.79 billion (+6.18% YoY), followed by Bank of Ningbo (RMB 344.37 billion, +7.13% YoY) and Bank of Hangzhou (RMB 193.40 billion, +5.36% YoY). - **Net Profit**: Bank of Ningbo topped with RMB 136.49 billion (+5.42% YoY), while Bank of Hangzhou’s profit surged 20.06% to nearly RMB 100 billion, narrowing the gap. CZBANK lagged at RMB 79.99 billion (+3.31% YoY). - **Profitability Metrics**: Bank of Ningbo’s ROAA (0.95%) and ROAE (14.74%) outperformed peers, with CZBANK’s ROAE at 9.65% (lowest among the three).
Bank of Ningbo’s market cap (RMB 1.34 trillion) dwarfs Bank of Hangzhou (RMB 755.52 billion) and CZBANK (RMB 719.57 billion).
**Asset Quality: Balanced but CZBANK Faces Higher Risks** All three banks maintain low non-performing loan (NPL) ratios, reflecting Zhejiang’s robust banking sector. However, CZBANK’s NPL ratio (1.43%) is nearly double that of Bank of Ningbo and Bank of Hangzhou (both 0.76%). Its provision coverage ratio (178.12%) also trails peers (Bank of Hangzhou: 545.17%; Bank of Ningbo: 420.55%), though all exceed regulatory requirements.
**Retail Finance: Bank of Ningbo Expands, Others Contract** Retail finance remains a battleground: - **CZBANK**: Corporate loans dominate (66.13%), while personal loans dipped to 27.79%. Efforts to boost retail include credit card and online loan products. - **Bank of Hangzhou**: Corporate loans rose to 67.05%, squeezing personal loans to 32.95%. It’s pivoting to digital channels for growth. - **Bank of Ningbo**: Personal loans (37.12%) lead peers, with consumer lending (RMB 331.82 billion) doubling CZBANK’s. Hangzhou’s consumer loans grew fastest (+30% YoY).
**Internal Controls: Leadership Turmoil and Regulatory Penalties** - **CZBANK**: Frequent management changes, including the abrupt resignation of President Zhang Rongsen nine days after reappointment, raise concerns. - **Bank of Hangzhou**: Fined RMB 1.1 million for fee violations, while its subsidiary, Hangzhou Bank Wealth Management, was penalized RMB 600,000 for compliance lapses. An independent director also faces investigation. - **Bank of Ningbo**: Fined RMB 700,000 for mismatched risk profiling in wealth management sales.
**Outlook** Bank of Ningbo excels in profitability, market cap, and retail finance, solidifying its lead. CZBANK, despite its asset size, must address performance and governance gaps. Bank of Hangzhou, though smaller, shows promising growth. As macro conditions shift, sustaining stability and competitive edges will be critical for all three.
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