A huge transfer of wealth into the Chinese countryside is driving record profits for rural financial institutions that were struggling to survive just a few years ago, according to the chairman of Agricultural Bank of China, the country’s largest rural lender.
In an interview with the Financial Times, Xiang Junbo, chairman, predicted that AgBank, which a decade ago was technically insolvent, would continue to reap record profits from Beijing’s plans to pump more money into the countryside.
AgBank said on Tuesday that net profits last year grew 46 per cent to Rmb95bn ($14bn), far outstripping the average net income growth of 29 per cent last year for its large domestic peers, which have focused their operations in fast-growing urban areas over the past decade.