HONG KONG, 4 July 2025. CSPI Ratings has affirmed China Construction Bank Corporation’s (CCB) global-scale long-term issuer credit rating (LTICR) of ‘AA-’ and short-term issuer credit rating (STICR) of ‘A-1+’. The Outlook is Stable.
The Bank’s LTICR incorporates a standalone credit profile (SACP) of ‘a-’, which considers its outstanding market franchise, strong capitalization, stable asset quality, and above-average profitability. It also takes into account CCB’s susceptibility to economic volatilities with continuous pressures on asset quality and profitability. In addition, we believe that the Chinese government (‘AA’/Stable) has an extremely strong willingness to support CCB in times of need, given the state ownership, the Bank’s irreplaceable importance to the financial system, and its quasi-policy role to the government initiatives.
The Stable Outlook reflects our view that CCB will remain an integral part of the Chinese financial system and, as such, the government will continue to have an extremely strong willingness to provide support.
We would consider downgrading the Bank if the LTICR of the sovereign is downgraded and/or if the government’s willingness to support noticeably weakens.
We would consider upgrading the Bank if the LTICR of the sovereign is upgraded and/or the government’s willingness to support further strengthens.
KEY RATING RATIONALE
Credit Strengths
Extremely Strong State Support: We forecast the government’s willingness to support CCB in times of need to be extremely strong, given the Bank’s state ownership of 57.14% directly under Central Huijin Investment Ltd. (Central Huijin) as of end-2024, critical importance to the government, and global systemically importance position.
As one of the six officially designated large state-owned banks in the country, CCB has an irreplaceable position in the domestic financial market, especially in the fields of infrastructure construction and housing mortgage. CCB’s long-term strategy is, to a large extent, formulated with public policy in mind. This is reflected in management’s publicly stated strategic statement to support the government’s objectives to shore up strategically important industries and maintain system and social stability. Furthermore, we believe the Bank’s current market position, profitability, and capital level are fully supportive of its sustainable role as a critical GRE.
Outstanding market franchise: We expect CCB’s market franchise to remain vigorous, considering its position as the second largest commercial bank in the world and in China in terms of loan size and total shareholder equity. These warrant its status as a global systemically important bank (G-SIB) and a domestic systemically important bank (D-SIB). CCB had a stable domestic market share of around 9% in loans and deposits at the end of 2024, supported by its extensive network of 14,750 branches and service outlets and its full range of businesses providing comprehensive financial services. The Bank has a competitive advantage in housing mortgage sectors. As of end-2024, CCB’s domestic residential mortgages totaled RMB6.19 trillion, which was at the leading level among the Large State-owned Banks (‘LSOB’).
Strong capitalization: We see CCB’s capital profile as strong. Meanwhile, given that CCB completed the private placement to the Ministry of Finance of China in June 2025, we expect its capital position to be further enhanced within the next 12-18 months. As of the end of 2024, the bank's common equity tier 1 (CET1) capital ratio, tier 1 capital ratio, and total capital adequacy ratio (CAR) were 14.48%, 15.21%, and 19.69% respectively, all higher than 13.15%, 14.04%, and 17.95% at the end of the previous year. CCB has continuously maintained its capital profile at a relatively higher level through stable retained earnings and capital instrument issuance. In 2024, the bank collectively issued Tier 2 capital bonds of RMB135 billion and a total of RMB50 billion fixed-rate total loss-absorbing capacity non-capital bonds to enhance the bank's total loss-absorbing capacity. In March 2025, CCB released a private placement plan, proposing to issue A-shares to the Ministry of Finance of China at a price of RMB9.27 per share. The proposed fundraising for this issuance is no more than RMB105 billion, which will be fully used to supplement the bank's common equity tier 1 capital after deducting relevant issuance expenses. On June 24, 2025, CCB announced the completion of its private placement. As of June 23, 2025, the total funds raised in this issuance amounted to RMB 105 billion. After deducting the expenses related to the issuance, the net proceeds were RMB 104.97 billion, of which RMB 11.59 billion was recorded as share capital and RMB 93.38 billion was recorded as capital reserve. After this capital increase, the bank's controlling shareholder will remain Central Huijin. It is anticipated that the bank's risk resistance capabilities will be enhanced, and indicators such as the CET1 will be further improved.
Stable asset quality: We expect CCB to maintain stable asset-quality metrics due to manageable non-performing-loan (NPL) formation on the back of continuous economic recovery and the Bank’s NPL resolution. Although the rising trend of risk exposure in the retail sector needs attention, the overall risks are controllable. CCB’s NPL ratio improved to 1.34% at the end of 2024 from 1.37% at the end of 2023, outperforming the industry average of 1.50%, but slightly weaker than the LSOB average of 1.24%. The NPL ratio of corporate loans and advances decreased from 1.88% at the end of the previous year to 1.65%, mainly benefiting from the gradual resolution of risks in the real estate industry. In 2024, the NPL ratio of the real estate industry showed a downward trend for the first time in recent years, dropping from 5.64% at the end of the previous year to 4.79%. The NPL ratio of personal loans and advances increased from 0.66% at the end of the previous year to 0.98%, among which the NPL ratios of residential mortgages, credit card loans, and personal business loans all rose to varying degrees, in line with the overall industry trend. Considering that CCB's current NPL ratio for personal loans and advances is still lower than that of its peers, and CCB has stated that it will strengthen the full-process risk control of retail loans, the overall risks are controllable.
In 2024, the special mention loan (SML) ratio decreased from 2.44% at the end of 2023 to 1.89%, and the provision coverage ratio slightly decreased from 239.85% to 233.60%, but it still outperforms the industry average of 211.19%, indicating sufficient risk compensation capability. The CCB’s percentage of loans overdue more than 3-month further increased from 0.77% at the end of 2023 to 1.02% in 2024, while NPL / loans overdue more than 3-month decreased from 178% at the end of 2023 to 134%, reflecting that CCB has relaxed its NPL recognition standards. In terms of financial investments, as of the end of 2024, CCB's total financial investments amounted to RMB10.68 trillion, of which 89.58% were bonds issued by the government, central bank, and policy banks with minimal credit risk.
Above-average profitability: We forecast CCB to maintain above-average profitability underpinned by a satisfactory Net Interest Margin (NIM) owing to outstanding market franchise, stable fee income contribution and effective cost control. The return on average shareholder’s equity (ROAE) and average assets (ROAA) were 10.69% and 0.85%, respectively, compared favorably to the sector average of 8.10% and 0.63% at the end of 2024, ranking top two among the LSOB. In 2024, affected by cuts of central bank’s loan prime rates (LPR) and deposit cost rate, CCB's NIM fell from 1.70% in 2023 to 1.51%, but it still ranked second among the LSOB and continued to outperform the industry average.
Moreover, the bank’s net fee income contributed to 13.99% of operating income. The bank’s credit cost gradually declined to RMB 120.7 billion from the peak of RMB 193.5 billion in 2020, due to the easing provision pressure driven by the bank’s asset quality improvement. In 2025, CCB successfully completed a private placement, which has significantly increased the bank's share capital and net asset scale. Considering that it takes a certain time for the raised funds to be invested and generate benefits, the Bank's ROAE is expected to decline by a certain margin in the medium to short term.
Susceptible to Economic Volatilities: As a major state-owned bank domestically, CCB will continue to be subject to a high degree of market volatilities due to its role of serving the real economy and stabilizing the financial system. CCB’s loan portfolio tracks closely with that of the broader market, with large exposure to leasing and commercial services, transportation, and manufacturing representing 10.14%, 9.26%, and 8.42% of total loans at the end of 2024, respectively.
The complex and challenging international and domestic situation is likely to continue to put pressure on CCB’s asset quality and earnings. The intensified international geopolitical conflicts, macro-policy uncertainty in developed economies, and risk events at Silicon Valley Bank and Credit Suisse may increase the volatility of global financial markets. Domestically, the slow recovery of the domestic macroeconomy, the mounting pressure in the property and LGFV sectors, and the tightening of financial regulation have led to the credit risk exposure in certain regions and industries.
Note: Ratings mentioned in this press release are unsolicited ratings.
ANALYSTS CONTACT
Primary Analyst
Tingting Qiao
+852 3615 8339
tingting.qiao@cspi-ratings.com
Secondary Analyst
Sherlock Liang
+86 755 2348 3690
sherlock.liang@cspi-ratings.com
Committee Chair
Winnie Guo
+852 3615 8344
MEDIA CONTACT
Rating Services Contact
Allen Wei
+852 3615 8324
allen.wei@cspi-ratings.com
Date of Relevant Rating Committee: 27 June 2025
Additional information is available on www.cspi-ratings.com
Related Criteria
Global Banking Rating Criteria (16 August 2019)
Government-Related Entities Rating Criteria (31 August 2018)
Rating Symbols and Definitions (7 May 2018)
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