According to Caixin News Agency on September 6th, under the pressure of asset quality in the retail sector, China Construction Bank Corporation has further increased the transfer of non-performing loans for individuals.

According to a rough calculation by Caixin News Agency, in the first week of September, China Construction Bank Corporation consecutively released 35 pieces of information on the transfer of non-performing loans in the non-performing loan transfer area of the Credit Registration Center, involving a total of 2.818 billion yuan in unpaid principal and interest. Among them, 34 were projects for the transfer of non-performing loans for personal consumption or operation.

In the view of industry insiders, China Construction Bank Corporation has been intensively transferring non-performing loans, mainly due to the relatively high generation of retail non-performing loans and non-performing loan ratios since this year, which has put certain pressure on asset quality. Data shows that at the end of the first half of the year, the non-performing loan and advance ratio of China Construction Bank Corporation's personal loans increased by 0.18 percentage point compared to the end of last year, with varying degrees of increase in housing, credit card, operation, consumer and other types of loans.

"The overall risk pressure on the retail side of the entire industry is relatively high, and the industry will continue to maintain a high level of disposal of non-performing assets in the second half of the year." Experts said. It is understood that at the end of the first half of this year, the non-performing loan ratio of 42 listed banks in the retail sector was 1.41%, an increase of 0.23 percentage point from the end of last year.

China Construction Bank Corporation has successively launched 35 projects for the transfer of non-performing loans, with a total unpaid principal and interest exceeding 2.8 billion yuan.

According to the disclosure of the non-performing loan transfer area of the Credit Registration Center, in the first week of September alone, China Construction Bank Corporation had successively released 35 pieces of information on the transfer of non-performing loans. Caixin News Agency found that in terms of amount, the total unpaid principal and interest of the aforementioned projects reached 2.818 billion yuan; in terms of the type of non-performing loans, only one was for the transfer of non-performing loans for corporate clients, and the other 34 were projects for the transfer of non-performing loans for personal consumption or operation.

"Actively resolving and disposing of non-performing assets is conducive to consolidating the sound operation foundation of banks." Industry analysts believe that the intensive transfer of non-performing asset projects by China Construction Bank Corporation is mainly due to the relatively high generation of retail non-performing loans and non-performing loan ratios since this year, which has put certain pressure on asset quality, and it also reflects the bank's active exploration of channels for disposal of non-performing assets.

According to the reporters of Financial Association, the non-performing loan balance of China Construction Bank as of the end of June this year was 342.904 billion yuan, an increase of 17.648 billion yuan from the end of last year; the non-performing loan ratio was 1.35%, a decrease of 0.02 percentage points from the end of last year. However, while the overall non-performing loan ratio improved, the non-performing loan ratio for personal loans and advances at the bank increased by 0.18 percentage points to 0.84%.

In particular, the non-performing loan ratio for personal business loans increased by 0.62 percentage points to 1.57% compared to the end of last year. In addition, the non-performing loan ratio for credit card loans at the bank also increased by 0.2 percentage points to 1.86%, the non-performing loan ratio for personal consumption loans increased by 0.04 percentage points to 0.9%, and the non-performing loan ratio for personal housing loans increased by 0.12 percentage points to 0.54%.

At the same time, the China Construction Bank has been increasing its efforts to dispose of non-performing assets. According to the semi-annual report, the bank transferred non-performing loan principal of 6.845 billion yuan to external asset management companies in the first six months, an increase of 5.174 billion yuan compared to the same period last year.

In addition, as of the first half of this year, there were still 7.487 billion yuan of loans and advances dispensed by the bank that have been written off as conditional litigation and are still subject to execution and disposal, a decrease of 0.256 billion yuan compared to the same period last year.

Looking ahead to the future trend of asset quality, Li Jianjiang, the Vice President of China Construction Bank, stated at the half-year earnings conference that the company will continue to enhance risk awareness, adhere to a bottom-line mindset, fully grasp the risk situation, further strengthen proactive management and control, and expects that asset quality will continue to operate smoothly in the second half of the year, with key areas of risk remaining under control.

The retail asset quality of listed banks is generally under pressure, and the industry will maintain a high level of disposal of non-performing assets in the second half of the year.

In fact, it's not just China Construction Bank that has been experiencing pressure on retail asset quality this year. Reporters from Financial Association have found that in the first half of this year, the non-performing loan ratios of listed banks for personal loans generally increased compared to the end of last year.

Overall, as of the end of the first half of the year, the non-performing loan ratio for retail lending at 42 listed banks was 1.41%, an increase of 23 basis points from the end of last year. Among them, the non-performing loan ratios for mortgage loans, consumer loans, business loans, and credit cards increased by 8, 11, 22, and 27 basis points respectively compared to the end of last year.

From the perspective of state-owned banks, the non-performing loan ratios of the six state-owned banks have all increased to varying degrees, including China Construction Bank, with four of them increasing by more than 10 basis points. Among them, Industrial and Commercial Bank of China rose 20 basis points to 0.90% compared to the end of the previous year, Bank of Communications rose 17 basis points to 0.98%, and Bank of China rose 12 basis points to 0.88%.

At the recent earnings conferences, many bank management teams also talked about the asset quality on the retail side. For example, Wang Ying, Deputy President of CM Bank, frankly stated that the asset quality control of retail credit is still facing challenges in the second half of this year and the future, and the bank's non-performing loan ratio, watch list ratio, and overdue rate will rise slightly.

In the view of Ni Jun, Chief Analyst of GF Sec, the main reason is the slowdown in social financing growth since this year and the gradual withdrawal of previous policies supporting small and micro enterprises. This has significantly increased the pressure on the risk exposure of banks' retail side, causing an increase in the retail non-performing loan ratio and fluctuations in various forward-looking asset quality indicators. "This trend is expected to continue in the second half of the year and gradually reflect in non-performing loan ratios and provision coverage ratios," he said.

At the same time, industry analysts have also told Caixin reporters that the overall risk pressure on the retail side of the entire industry is relatively high. All institutions are actively disposing of non-performing assets through various means, and the industry will continue to maintain a significant level of disposal of non-performing assets in the second half of the year.

"In recent years, China has actively developed the market for disposing non-performing assets, expanding the channels for disposing non-performing assets and the participants in the non-performing asset market, and encouraging innovative ways of disposing non-performing assets. In addition to write-offs and collection, the transfer and securitization of non-performing assets are also developing rapidly," analysts said.