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ICBC

ICBC

Tagline

By your side, as your trust

Net Worth

$4,913,000,000,000

Started in (City)

Beijing

Started in (Country)

China

Incorporation Date

01st December, 1984

Bankruptcy Date

-

Founders

  • State Owned (beijing)

About

Industrial and Commercial Bank of China Limited is a Chinese multinational banking firm. It’s the largest Bank in China, and the biggest bank in the world by total assets, deposits, loans, number of customers, and employees. It’s one of China’s "Big Four" state-owned commercial banks (the other three being the Bank of China, Agricultural Bank of China, and China Construction Bank). As of December 2017, it had assets worth US$4.009 trillion. Generally considered the most important financial institution and public business globally by assets, it’s the first Chinese Bank to accomplish such a feat. It ranks number 1 in The Banker’s Top 1000 World Banks standing, and first on the Forbes and Global 2000 list of the world’s largest public companies.

Beginning

Industrial and Commercial Bank of China (ICBC) opened its first office division on January 1, 1984, in Beijing as a neighborhood state-run bank. In 1999, ICBC opened a branch in Luxembourg that became the bank’s European headquarters in 2011. ICBC (Europe) SA operates a network covering branches in major European cities, namely Paris, Amsterdam, Brussels, Milan, Madrid, Barcelona, Warsaw, and Lisbon. Growing through, ICBC bought the Hong Kong subsidiary of Fortis Bank and rebranded it under its title on October 10, 2005. The Bank’s Hong Kong operations are recorded under the title ICBC Asia. In the run-up to its planned initial public offering, on April 28, 2006, three "strategic investors" increased US$3.7 billion to ICBC. Goldman Sachs bought a 5.75% stake for US$2.6 billion, the most significant sum Goldman Sachs had heavily invested in so far. The second strategic investor was the Dresdner Bank (a wholly-owned subsidiary of Commerzbank) who decided to spend approximately US$1 billion. And the third and final investor, American Express went ahead and spent close to US$200 million and all in turn helped coin ICBC as the World’s Biggest IPO (at the time).

Road to Success

ICBC conquer over the world and capturing market can be summarised within these few key points: -ICBC was concurrently listed on both the Hong Kong Stock Exchange and Shanghai Stock Exchange on October 27, 2006. It had been the world’s largest IPO at the time, valued at US$21.9 billion, surpassing the Previous record US$18.4 billion IPO from Japan’s NTT DoCoMo in 1998. In 2010, the Agricultural Bank of China broke ICBC’s IPO record as it increased $22.1 billion. China’s largest commercial bank was also the first to debut simultaneously on both the Hong Kong and Shanghai stock exchanges. ICBC increased at US$14 billion in Hong Kong (H-shares) and another US$5.1 billion in Shanghai (A-shares). Because of massive subscriptions, the greenshoe (i.e., over-allotment) placements were exercised, And ICBC’s take climbed to US$21.9 billion (17 percent of ICBC’s market value before the IPO), split into US$16 billion in Hong Kong and US$5.9 billion in Shanghai. -In November, ICBC obtained for $600 million 80% stake of Standard Bank Argentina and, six months later, the change has been made in the 103 branches the South American Bank had in the country. It’s the biggest operation of a Chinese bank in Latin America. -On September 24, 2014, ICBC Kuwait Branch officially opened in Kuwait City, Kuwait’s capital. Since the first and currently the only Chinese bank in Kuwait, the institution of ICBC Kuwait Branch stopped the history of no Chinese bank’s presence in Kuwait. Meanwhile, It’s also the fourth division of ICBC in the Middle East, after branches in Dubai, Abu Dhabi, and Doha. ICBC Financial Services, the bank’s brokerage unit, provided about $88 billion of repo financing at the end of 2015, up from $59 billion two decades back, according to regulatory filings. The figures are before netting agreements, which may be used to decrease overall assets and liabilities.

Challenges

-Caught in the trade war, ICBC had to face quite a few hurdles along the way. The aforementioned hurdle gave rise to another obstacle namely, the concern that big lenders were expected to relax their underwriting policies to stimulate the economy. -International environmental groups have criticized ICBC for failing to adhere to its social-environmental criteria and being hypocritical because ICBC is involved in contentious funding. -Having virtually missed all of if its prior decade financial targets, ICBC was concerned with the rising trust issues that seemed to be upheld in its direction for a while. -Back in 2016, ICBC had to face a profound challenge that the business backdrop posed, with lenders leaning to adapt towards the lower economic growth and to try and steer towards the promise offered by igniting domestic demand in the world's second-largest economy. The business backdrop in China was profoundly challenging in 2016, as lenders learned to adapt to a lower baseline rate of economic growth and to steer towards the promise offered by igniting domestic demand in the world’s second-largest economy. ICBC, Global Finance’s Best Bank in the Asia-Pacific region, appears to have come away unscathed and revitalized by the experience.

Failures

At the end of 2004, 19.1 percent of ICBC’s portfolio consisted of non-performing loans. To clean up ICBC’s balance sheet and prepare it for an overseas record, the Chinese government orchestrated a string of capital injections, asset transfers, and government-subsidized harmful loan disposals that eventually cost more than US$162 billion. This included approval for a cash injection of US$15 billion (funded from China’s massive foreign exchange reserves) on April 28, 2005. The Beijing-based state firm, China Huarong Asset Management, helped ICBC eliminate its bad loans. Since the 2005 annual report documents, just under 5 percent of loans are categorized as non-performing, compared with the vast majority of western banks with lower NPL ratios (US commercial banks approximately 1 percent).

Achievements

  • Best Banking Performer
  • China in 2016 by Global Brands Magazine Award
  • International 2000 Rank #1 - World’s Largest Public Companies in 2016.

Subsidies

  • ICBC (London) plc
  • ICBC Turkey Bank
  • Industrial and Commercial Bank Of China Mexico, S.A. Institución de Banca Múltiple
  • Industrial and Commercial Bank of China Limited, Singapore Branch
  • Industrial and Commercial Bank of China Ltd., Luxembourg Branch
  • Industrial And Commercial Bank Of China (ICBC) Manila Branch
  • Hai Jiao 1502 Limited

CEOs

  • Gu Shu
  • Nicolas Jimenez