Skip to Content

Agricultural Bank of China Ltd 01288

Rating as of

Morningstar’s Analysis

Valuation
Currency in HKD
Is it the right time to buy or sell?
Find out with Morningstar Premium
Is it the right time to buy or sell?
Find out with Morningstar Premium

1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Earnings Growths of Large Banks Are Expected To Recover to Beyond the Pre-Pandemic Level in 2019

Iris Tan, CFA Senior Equity Analyst

Analyst Note

| Iris Tan, CFA |

While there was little surprise in most Chinese banks' first-quarter results, we saw increasing divergence in performance among banks. We believe top-line growth was the key differentiator and this will continue to be reflected in the future growth trend. Net interest margins, or NIMs, remained pressured while credit quality improved. We believe the credit cycle that has hampered Chinese banks’ earnings growth since 2014 is about to turn for the better, while we stay cautious in our credit quality assumptions primarily on short-term pressure from bank wealth management product, or WMP, transition. We expect NIMs to rebound, with a modest decline in full year credit cost from 2020. 

Read Full Analysis

Company Profile

Business Description

Headquartered in Beijing, ABC evolved from a state-owned specialized bank to a state-controlled commercial bank. It listed on the Hong Kong and Shanghai Stock Exchanges in 2010. ABC operates more than 20,000-branch network in China, providing corporate and retail banking products and services, and carries out treasury operations for its own accounts or for its customers. Shareholders Central Huijin, China's state-owned investment company, and the Ministry of Finance own 40% and 35%, respectively. Corporate banking, retail banking, and wholesale banking accounted for 42%, 39%, and 12% of profit before tax, in 2020, respectively. Rural banking and urban banking contributed to nearly 40% of total profit before tax in 2020.

Contact
50 Connaught Road Central, 25th Floor, Agricultural Bank of China Tower
Hong Kong, China, People's Republic of
Sector Financial Services
Industry Banks - Diversified
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2020
Stock Type
Employees 459,000

Transparency is how we protect the integrity of our work and keep empowering investors to achieve their goals and dreams. And we have unwavering standards for how we keep that integrity intact, from our research and data to our policies on content and your personal data.

We’d like to share more about how we work and what drives our day-to-day business.

We sell different types of products and services to both investment professionals and individual investors. These products and services are usually sold through license agreements or subscriptions. Our investment management business generates asset-based fees, which are calculated as a percentage of assets under management. We also sell both admissions and sponsorship packages for our investment conferences and advertising on our websites and newsletters.

How we use your information depends on the product and service that you use and your relationship with us. We may use it to:

  • Verify your identity, personalize the content you receive, or create and administer your account.
  • Provide specific products and services to you, such as portfolio management or data aggregation.
  • Develop and improve features of our offerings.
  • Gear advertisements and other marketing efforts towards your interests.

To learn more about how we handle and protect your data, visit our privacy center.

Maintaining independence and editorial freedom is essential to our mission of empowering investor success. We provide a platform for our authors to report on investments fairly, accurately, and from the investor’s point of view. We also respect individual opinions––they represent the unvarnished thinking of our people and exacting analysis of our research processes. Our authors can publish views that we may or may not agree with, but they show their work, distinguish facts from opinions, and make sure their analysis is clear and in no way misleading or deceptive.

To further protect the integrity of our editorial content, we keep a strict separation between our sales teams and authors to remove any pressure or influence on our analyses and research.

Read our editorial policy to learn more about our process.