Wendy Zhang/ Shanghai Daily news

Banks on the Chinese Mainland recorded hefty profits last year, with 20 banks ranked among the top 300 banks in Asia, eastday.com reported today.
Last year, the 300 largest Asian banks by assets turned in a combined net profit of US$51.5 billion, an overall recovery from the net deficit of US$4.8 billion in 2003. Although Japanese banks still played a dominant role in the top 300 banks in Asia, Chinese banks have succeeded in ascending to the leading ranks.
The 20 banks, four of them state-owned, nine holding companies and seven commercial, boasted a record combined net profit of US$11.2 billion last year, accounting for one-fifth of the Asia total and up 21.2 percent from a year earlier.
The 20 banks also saw total credit volume increase by 15 percent from a year before and net interest revenue up 20.2 percent.
China Construction Bank reported the highest net profit in Asia last year, at US$5.9 billion a surge of 116 percent from the previous year.
Thanks to government support, the Bank of China and China Construction Bank achieved outstanding performances last year. However, domestic banks are still challenged by bad debts, said Benny, an analyst with the Asian Banker Journal. Government bailouts have helped the two banks lower their bad debt ratio from 16.3 and 9.1 percent in 2003 to 5.1 and 3.7 percent respectively last year.
With the Chinese financial sector to undergo an industry-wide opening by 2007, domestic banks are gearing up for business reforms by focusing on retail operations to tap new cash flows. Currently, retail business has only accounted for 10-20 percent of the total, so many banks are expecting to drive up the proportion to 30 percent, as compared to 50 percent at Citibank.