Top 10 trends and prospects of the Chinese Banking Industry 2014

In 2013, the profit growth of China's banking sector continued to decline with the tremendous impact of interest rate marketization and the robust growth of internet finance in the traditional commercial banking sector. Traditional commercial banks are now in need of changing their way of thinking to accelerate business transformation and product innovation in order to meet the rapidly changing market conditions and challenges.

This annual report summarizes and examines 10 of the most discussed issues in the Chinese banking sector which are expected to exert major influence on the industry in the next two to three years:

1.     Profit growth continues to decline

2.     Interest rate marketization forces banks to accelerate business transformation

3.     "New banks" enhance market competition

4.     Preventing system risk as bank liquidity risk grows

5.     The convergence of internet finance and traditional banking

6.     Deposit insurance system enhances financial stability

7.     Credit risk grows as SME banks reinforce structural reforms

8.     RMB globalization continues to deepen financial opening and innovation

9.     Stricter financial regulating as risks of shadow banking grow

10.  "Living will" debuts as banks implement new Basel Accord

Considering the issues from a variety of viewpoints backed by solid data analysis, this report aims at delivering a forward-looking point of view about the future prospects of the banking industry in China.