Industrial and Commercial Bank of China (ICBC) released its 2025 Pillar 3 Disclosure Report, detailing capital adequacy, risk-weighted assets (RWA), leverage and liquidity metrics for the year ended 31 December 2025.
Capital Position • Net Common Equity Tier 1 (CET1) capital reached 3,837.15 billion RMB, underpinning a CET1 ratio of 13.57%, down 0.53 percentage points from 2024 as asset growth outpaced capital accumulation. • Tier 1 and total capital adequacy ratios stood at 14.94% and 18.76% respectively, both well above the domestic minimums of 6.00% and 8.00%. • The capital conservation buffer (2.50%) and G-SIB surcharge (1.50%) lift ICBC’s additional capital requirement to 4.00%. The bank will move from Bucket 2 to Bucket 3 in 2027, when the surcharge rises to 2.00%.
Loss-Absorbing Capacity • External Total Loss-Absorbing Capacity (TLAC) amounted to 6,069.54 billion RMB, equating to 21.47% of RWA and 10.79% of leverage exposure—comfortably above the 20% and 6% regulatory thresholds effective 2025.
Risk-Weighted Assets • Total RWA expanded to 28,269.95 billion RMB, driven mainly by credit risk (25,927.33 billion RMB, 91.8% of RWA). • Market and operational risk contributed 472.26 billion RMB and 1,788.91 billion RMB, respectively. • Internal Ratings-Based (IRB) portfolios account for 46.51% of EAD and 67.25% of credit RWA, reflecting ICBC’s advanced modelling coverage.
Leverage and Liquidity • The leverage ratio closed the year at 7.51%, comfortably above the 4.00% minimum. • High-quality liquid assets averaged 11,479.74 billion RMB in Q4 2025, supporting a liquidity coverage ratio (LCR) of 138.61%. • The Net Stable Funding Ratio (NSFR) was 126.35%, providing a healthy buffer over the 100% requirement.
Interest Rate Risk in the Banking Book • A regulatory parallel down-shift in the yield curve would reduce economic value by 842.30 billion RMB (2.20% of Tier 1 capital), within the bank’s internal risk appetite. • A 100 basis-point parallel up-shift is estimated to boost net interest income for the next 12 months by 35.80 billion RMB.
Asset Quality and Securitisation • Asset securitisation exposures totalled 1.75 billion RMB as originator and 0.85 billion RMB as investor, with no resecuritisations reported. The bank uses securitisation primarily to optimise credit structure and manage non-performing assets.
Operational & Market Risk Management • Operational risk capital requirement was 143.11 billion RMB, based on the Basel III standardised approach with an internal loss multiplier of 1. • Market risk capital, measured via the standardised approach, totalled 37.78 billion RMB, dominated by default risk (13.08 billion RMB) and credit spread risk on non-securitised products (12.03 billion RMB).
Outlook on Capital Planning ICBC confirmed that all regulatory capital, leverage and liquidity ratios remained above the required thresholds throughout 2025. The board has launched preparation of a new five-year capital plan to ensure continued compliance with forthcoming higher G-SIB buffers and to support the bank’s strategic growth objectives.
Comments