HONG KONG, 4 July 2025. CSPI Ratings has affirmed Industrial and Commercial Bank of China’s (ICBC or the Bank) 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 leading market franchise, robust capitalization, resilient asset quality, and strong funding and liquidity. It also takes into account ICBC’s susceptibility to market volatility. In addition, we believe that the Chinese government (‘AA’/Stable) has an extremely strong willingness to support ICBC in times of need, considering the state ownership, the bank’s status as the largest state-owned bank in China, and its systemic importance to the financial system.
The Stable Outlook reflects our view that the Bank 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 if the government’s willingness to support further strengthens.
KEY RATING RATIONALE
Credit Strengths
Extremely strong sovereign support: We believe that the Chinese government’s willingness to support ICBC in times of need is extremely strong, given the Bank’s 69.39% state ownership directly under Central Huijin Investment Ltd., the Social Security Fund, and the Ministry of Finance, its quasi-policy role in government initiatives, and its systemic importance as the largest state-owned bank in China. ICBC’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 manufacturing and strategic emerging industries, as well as promote economic development and maintain financial system stability.
Leading market franchise: We expect that ICBC will continue to maintain its strong business franchise as the largest bank in the world by total assets and loan balance, given its solid customer base, extensive service channels, and diversified business structure. This warrants its status as a global systemically important bank (G-SIBs) and a domestic systemically important bank (D-SIBs) in China. In recent years, the Bank has had the largest domestic deposit market share of around 10-11% owing to its high-quality customer base. In addition, ICBC provides a wide range of products and services, covering funds, leasing, insurance, wealth management, financial technology, and overseas investment banking, serving more than 13 million corporate customers and 766 million personal customers all over the world.
Robust capitalization: ICBC will continuously maintain its capital profile at a relatively higher level, thanks to its good internal capital generation and capital market access. The "Capital Management Measures for Commercial Banks," which were implemented starting in 2024, brought about certain capital savings for the Bank. By the end of the year, indicators such as the capital adequacy ratio improved compared to the end of 2023, and were consistently higher than the state-owned peers. As of the end of 2024, the Bank had a common equity tier 1 capital adequacy ratio of 14.10%, a tier 1 capital adequacy ratio of 15.36%, and a total capital adequacy ratio of 19.39%. In 2024, ICBC collectively issued RMB50.0 billion undated additional tier 1 capital bonds and RMB90 billion in Tier-2 capital bonds to replenish the Bank’s capital. In March 2025, the Bank also publicly issued 50.0 billion tier 2 capital bonds. In addition, as one of the G-SIBs, the bank successfully issued RMB50.0 billion total loss-absorbing capacity non-capital bonds in 2024, further enhancing its total loss-absorbing capacity.
Resilient asset quality: ICBC’s asset quality will remain stable in our projection over the next 12-18 months, in view of the Bank’s continued non-performing loan (NPL) resolution and selective lending strategy. ICBC’s overall NPL ratio improved to 1.34% in 2024 from 1.36% in 2023, compared favorably to the sector average of 1.50%. Specifically, the Bank has continued to strengthen risk management in the real estate sector. As of the end of 2024, although the proportion of real estate loans increased from 5.1% at the end of the previous year to 5.4%, the NPL ratio decreased from 5.37% to 4.99%, indicating that the risks in this area are manageable. Benefiting from this, the NPL ratio for corporate loans fell from 1.81% at the end of 2023 to 1.58% by the end of the year. Conversely, the NPL ratio for personal loans rose from 0.70% at the end of the previous year to 1.15% at the end of 2024. This increase was observed across personal consumption loans, residential mortgages, and credit card overdrafts, all showing varying degrees of rise. In the future, the Bank will enhance the intelligent risk monitoring management for the entire life cycle of personal loans and continue to promote the disposal of non-performing assets.
In 2024, the special-mention loan (SML) ratios increased from 1.85% at the end of 2023 to 2.02%, while the provision coverage ratio slightly increased from 213.97% to 214.91%, exceeding the industry average of 211.19%, indicating sufficient risk compensation capacity. We note that the percentage of loans overdue by more than three months rose from 0.86% at the end of 2023 to 1.00%. Meanwhile, the ratio of non-performing loans to loans overdue by more than 90 days decreased from 158% at the end of 2023 to 133%, reflecting a relaxation in the criteria for recognizing non-performing loans.
ICBC’s investment assets increased to RMB14.15 trillion at the end of 2024, up by 19.44% from 2023. Bond investment accounted for 96.4% of the investment portfolio, including 84.4% in bonds with minimal credit risk issued by the government, central bank, or policy banks.
Strong funding and liquidity: We believe that ICBC will maintain its good funding structure, given its vast retail deposit base. Customer deposits are the Bank’s primary source of funding. As of the end of 2024, 77.70% of total liabilities were customer deposits, which amounted to RMB 34.84 trillion. Its retail deposits increased by 11.93% in 2024, and its proportion to total deposits has been rising gradually. The Bank also has abundant liquidity, with a liquidity coverage ratio of 140.25% and a net stable funding ratio of 128.16% at the end of 2024, both of which were much higher than the minimum regulatory requirement of 100%.
Susceptible to Economic Volatilities: As the largest bank domestically, ICBC will continue to be sensitive to operating environment volatilities due to its role as a state-owned bank serving the real economy, which may require credit exposures of weaker quality and challenge the Bank’s asset quality under stress scenarios. ICBC’s loan portfolio tracks closely with that of the broader market, with large exposure to transportation, manufacturing, and leasing and commercial services representing 23.8%, 15.1%, and 14.9% of corporate loans at the end of 2024, respectively.
The complex and challenging international and domestic situation is likely to continue to put pressure on ICBC’s asset quality and earnings. The intensified international geopolitical conflicts, macro-policy uncertainty in developed economies, 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: The 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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