Banks in race to stay healthy

Divergence in performance of State banks, private lenders to increase this year

Divergence in the performance of large State-owned lenders and private-sector listed banks in China will increase this year, and liabilities will be in focus as competition among them heats up, analysts said.

"The net interest margin is the most crucial driver of divergence in bank performance in 2018," said Sophie Jiang, a banking analyst at Nomura. "Compared with large State-owned commercial banks, joint-stock commercial lenders will continuously face greater pressure on liabilities this year. The pressure will have negative impact on NIM figures for joint-stock commercial banks and restrain their credit growth to a certain extent."