China’s four largest state-owned banks are set to receive a combined 520 billion yuan ($72.5 billion) capital infusion through targeted A-share sales, backed by a 500 billion yuan government-led initiative to fortify financial resilience and support economic growth.
Bank of China, China Construction Bank, Bank of Communications, and Postal Savings Bank of China disclosed plans to issue shares primarily to institutional investors, with the Ministry of Finance (MOF) committing to subscribe to up to 500 billion yuan. The funds will bolster core tier-1 capital—a critical metric for financial stability—following approval by the National People's Congress.
"This strategic move optimizes state capital allocation and strengthens our capacity to serve national priorities," stated China Construction Bank, emphasizing the initiative’s alignment with macroeconomic recovery goals. The banks collectively reported 750 billion yuan in net profits for 2023, with regulators confirming asset quality remains in the "healthy range."
Analysts describe the recapitalization as a proactive measure to enhance risk management and lending capacity. "This ensures banks can better fuel the real economy while maintaining systemic stability," said an industry expert, underscoring the long-term benefits for investors and China’s economic trajectory.
