Top Banking Brands - ICBC Profile

The Industrial and Commerce Bank of China

Brand Strapline
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Offices: 18,000
Employees: 351,448
Country: China

ICBC Brand 2009 - Facts & Figures


	2009		2008
Brand Value	$10,031m	Brand Value	$8,427m
Brand Ranking	5	Brand Ranking	16
Market Cap	$186,089m	Market Cap	$343,424m
Brand Value / Market Cap (%)	5%	Brand Value / Market Cap (%)	2%
Brand Rating	A+	Brand Rating	A-

History of the Company

The Industrial and Commerce Bank of China (ICBC - Zhongguó Gongshang Yínháng, or more commonly just Gongháng) was founded as a limited company on in 1984 and has grown to become one of China's big 4 banks. In October 2006 ICBC was simultaneously listed on both the Hong Kong Stock Exchange and Shanghai Stock Exchange. It was the world's largest IPO to date. ICBC raised at least US$14 billion in Hong Kong (H-shares) and another US$5.1 billion in Shanghai (A-shares). At the end of its first day of trading, the bank’s shares closed up almost 15% at HK$3.52 in Hong Kong, compared with the listing price of HK$3.07, which was set at the top of the indicative range due to the strong demand. According to Bloomberg, ICBC’s market capitalisation at the end of trade based on its Hong Kong shares was US$156.3 billion, making it the world’s fifth largest bank.

In July 2007, with a market capitalization of US$254 billion, ICBC became the world's most valuable bank after a strong gain in its share price, overtaking Citigroup.

Geography and Products

The Bank operates uniquely in Asia. 50% of its operations are in commercial banking. ICBC differentiates itself from its Chinese competitors by specialising in the FX and clearing markets. It is also a major supplier of funds in the manufacturing sector.

Fig1. ICBC Product Segmentation 2009 - Click on image to Expand into another window

Fig2. ICBC Geographic Segmentation 2009 - Click on image to Expand into another window

History of the Brand

ICBC operates in China, where all four of the main commercial banks are state-owned. Until 2001, when China joined the World Trade Organisation, the level of competition in Chinese banking was limited. However since then, the opening up of the market has led to increased commercialisation in the Chinese banking industry. The responsibility for government-directed spending functions passed on to policy banks in 1994, but non-performing loans still account for 5% of assets among China's big four banks (this figure is closer to 1% among western banks), and that is after a "clear-out" of bad debts prior to the IPOs of CCB and ICBC.

Recently the bank acquired the Hong Kong subsidiary of Fortis Bank, which it rebranded as ICBC Asia, and in October 2007 it acquired a 20% stake in Standard Bank of South Africa.

Performance of the Brand

We have recently discovered that many Western banks are too big to fail. This was never in doubt for ICBC, since it is state-owned. However, the increased commercialisation of banking in China has led to a greater need for branding and brand identity. ICBC is the largest of China's big four, and specialises in FX and clearing. It has also looked to expand its footprint with the acquisition of Fortis in Hong Kong and a share of Standard Bank of South Africa. As a result, ICBC is perceived as an international standard-bearer for Chinese banking.

The strong performance of the Chinese banking industry, coupled with the decline in many western bank brands, has seen ICBC soar up the league table from 16th to 4th, increasing in value by 19% from last year.

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