In Depth: China’s Banks Look to Bolster Bottom Line After Lending Binge

Despite issuing a record amount of loans in the first quarter, China’s banks are bracing for profitability to weaken further in 2023, after net interest margins were heavily squeezed by both loan rate cuts and rising deposit costs last year.

As they look to shore up profitability this year, many lenders in the $55 trillion sector by assets are turning to either increasing loan volumes or bolstering non-interest income from business units such as wealth management.