Thousands of Bank Outlets Closed in China This Year

Translator: Darkluke
Proofreader:Lish

On November 26, the Securities Daily reported that since this year, as of November 25, a total of 2,171 bank outlets of commercial banking institutions have ceased operations. According to statistics from the Securities Daily, the total number of staff in many listed banks has declined significantly from 2018 to 2020. Among them, the Agricultural Bank of China has shown a continuous downward trend that the staff number dropped from 474,000 in 2018 to 459,000 in 2020 — a decrease of approximately 15,000. Different outlets have different costs depending on the location and area, but if one wants to cover the cost of about 10 million yuan, a deposit of 1 billion yuan is needed to ensure that it does not lose money.

The main reason for banks’ difficulty in profitability is because their ability to absorb deposits has declined under the pressure of narrowing the net interest margin. Besides, business income is limited, and it is challenging to balance costs such as venue rent and labor expenses.

As of the end of July in 2021, the total number of people in debt nationwide has reached 780 million, with an overdue rate of 42%. The debt servicing burden of Chinese households is 137.9%, and every Chinese is in debt of RMB 70,000. So how can there be money to deposit in the bank?

Source:中共国年内有2171家银行网点关停 – GNEWS

Published by: Lish

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