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In 2023, the number of commercial banks in China was ***. Four of those were the world's largest banks based on assets, exceeding global heavyweights such as JPMorgan Chase, Bank of America, and HSBC. The value of the Chinese banking industry as a whole exceeded ** trillion U.S. dollars in 2022.

Multi-tiered banking system

After the establishment of the PRC in 1949, the socialization of the banking sector was one of the highest priorities of the newly established communist leadership. The structure of the banking system was modelled after the hierarchical organization of the state: a central government that fragments into smaller administrative units. The country's biggest commercial banks were state-owned. They include the Industrial and Commercial Bank of China (ICBC), China Construction Bank, and Bank of China. In addition, there were city and regional commercial banks, as well as rural commercial banks.

A bank for everything

As the name of many Chinese banks alludes, banks were originally established to serve specific sectors of the economy. Under collectivization, there were no enterprises, which meant that banks provided liquidity to work units. Initially, the Bank of China’s role was more akin to a central bank, as it managed China’s foreign reserves and set the exchange rates. The Agricultural Bank of China was responsible to financially supporting agricultural work units. At the local level, rural and urban credit cooperatives provided financial services for individual families. After China’s Opening Up policies, the banking system has undergone significant reforms, but the state still has a tight grip on the industry.