State-owned lenders to better serve private firms

Major State-owned commercial banks are aiming to continuously improve the quality and efficiency of services provided to private enterprises to firmly help the private sector address challenges such as financing difficulties and high costs, according to their 2024 annual results announcements.

"Bank of China plans to provide over $5 billion for intended financing of private enterprises in 2025, pledging enhanced financial assistance for their deep engagement in the Belt and Road Initiative," said Zhang Hui, president of BOC.

"BOC will strengthen cross-border financing, international settlements and overseas investment services to facilitate private companies' global expansion. It is committed to reducing financing costs for private businesses, offering tailored global cash management solutions to help enterprises reduce risks and improve capital utilization efficiency," Zhang said.

Agricultural Bank of China aims to ramp up credit support for private enterprises, with loans to the sector projected to exceed 7.5 trillion yuan ($1.03 trillion) by the end of 2025. ABC will provide fast, convenient and suitable financing solutions for private businesses, providing tailored services such as allocating dedicated credit resources, said Liu Hong, vice-president of ABC.

"The bank aims to enhance its capabilities in serving the private sector by innovating financial product and service models, cultivating professional talent teams and exploring new risk management approaches. These efforts are designed to promote the sustainable and high-quality development of private enterprises," Liu said.

"Industrial and Commercial Bank of China plans to provide no less than 6 trillion yuan in investment and financing support for private enterprises over the next three years, pledging robust assistance to help private enterprises strengthen industrial capabilities," said Zhang Shouchuan, vice-president of ICBC.

Zhang Shouchuan said that ICBC will further improve service mechanisms, leveraging financial tools to drive high-quality development of private enterprises.

China Construction Bank will implement its 2025 action plan to support the high-quality development of the private sector economy, pledging to deliver more resource guarantees, provide more targeted customer services, build better optimized long-term mechanisms and explore deeper multiparty collaboration, said Zhang Yi, president of CCB.

These plans laid out in the lenders' 2024 annual results announcement conference showed that major State-owned commercial banks are capitalizing on their strengths while responding to national policies to deliver high-quality financial services for the development of private enterprises, said Lou Feipeng, a researcher at Postal Savings Bank of China.

"These measures effectively address financing difficulties and high costs faced by private businesses, streamline loan accessibility and amplify the positive role of private enterprises in driving China's economic development," Lou said.

By expanding credit supply to private enterprises and reducing financing costs, banks have adopted highly targeted measures to alleviate the financing difficulties and high costs faced by micro, small and medium-sized private sector firms, he added.

Looking ahead, Lou said that banks need to intensify market research tailored to private enterprises of diverse scales and industries, focusing on targeted financing difficulties, to enhance the precision of financial services and elevate efficacy in serving the private sector.

Liu Zhihua contributed to this story.