China Merchants Bank
Transaction banking is something of a new discipline for Chinese commercial banks. Thanks to the rapid business restructuring it carried out, China Merchants Bank has set itself apart under general manager Zuo Chuanghong from its domestic peers by building the most efficient transaction banking operations among Chinese banks.
Transaction banking requires a bank to provide one-stop comprehensive financial solutions for corporate clients. To embrace transaction banking, Chinese banks must integrate corporate banking operations scattered in multiple units as well as branches and sub-branches into a tightly knit new business. Due to their massive scale of operations and complex business structures, state-owned commercial banks have not been able to adopt transaction banking in this sense.
In recent years, national commercial banks that are not state-owned and city commercial banks began transitioning towards transaction banking. CMB has emerged as a clear leader.
In 2016, CMB boasted the most comprehensive transaction banking services among Chinese banks, integrating all its corporate banking businesses, ranging from payments and settlements, cash management, trade finance, supply chain finance, cross-border finance to internet banking.
Last year, the bank also excelled in exploiting the synergies generated by the integration and capturing fresh business opportunities uncovered by its newly instituted transaction banking operations.
By offering comprehensive and customized financial services under the transaction banking structure, CMB not only strengthened relationships with corporate customers in traditional industries, but also picked up new clients among the leading internet companies in China, such as e-commerce leaders Alibaba and Didi Chuxing, the Chinese equivalent of ride-hailing service Uber.
In 2016, CMB’s transaction banking recorded robust business growth. By the end of the year, the intermediary businesses under the bank’s transaction banking structure generated more than Rmb8.6 billion ($1.3 billion) in income. The number was by far the biggest among China’s national commercial banks.