In 2020, 38 listed banks earned 42% of the net profit of A-shares, ranking the top four most profitable A-shares are Industrial and Commercial Bank of China, Construction Bank, Agricultural Bank and Bank of China.
The annual reports of mainland A-share listed companies for 2020 show that 38 listed banks made net profits of 1.69 trillion (RMB, same below), accounting for 42% of the net profits of listed companies, while the top 10 most profitable companies are all financial companies, nine of which are banks.
As reported by brokerage China on May 6, A-share listed companies have all announced their annual reports for 2020. According to data service provider Wind, all A-share companies will achieve operating income of 53 trillion yuan and net profit attributable to the mother company of nearly 4 trillion yuan in 2020, among which, 38 listed banks will have net profit of 1.69 trillion yuan, accounting for 42% of the net profit of all A-share listed companies, a level similar to that of 2019. in 2019, the net profit achieved by 36 listed banks together accounted for 41% of the net profit of all A-share listed companies. 41% of the net profit.
The annual report shows that the most profitable companies in A-shares are still banks, and the top ten are still financial institutions, except for Ping An of China, an insurance and financial group, all of which are banks. In order: Industrial and Commercial Bank of China, Construction Bank, Agricultural Bank of China, Bank of China, Ping An Insurance, China Merchants Bank, Bank of Communications, Industrial Bank, Post and Reserve Bank, Pudong Development Bank.
Among the top four ICBC, Construction Bank, Agricultural Bank and Bank of China net profit of 315.9 billion yuan, 271 billion yuan, 215.9 billion yuan and 192.9 billion yuan, respectively.
Although the money earned by 38 banks in 2020 accounted for 42% of the net profit of A-share listed companies, their total market value is about 10.3 trillion, accounting for only one-eighth of the total market value of all A-shares.
The announcement of the 38 listed banks’ net profit accounting for 42% of the net profit of A-share listed companies has sparked debate and dissatisfaction among netizens. The netizen “002100 Chen” said that the banks are relying on policies to make money: “vampires, relying on policies to spoil.” “Many gentlemen” spat: “are working for banks and landlords real estate.”
A-share data every year show that the most profitable companies in China are banks, which is very different from the most profitable companies in the United States, which are basically real companies like Apple, Microsoft and Amazon.
According to data from the Fortune 500 list, released by the official Fortune App on August 10, 2020, Chinese companies are less profitable. in 2019, the average profit of the 124 mainland Chinese companies on the list was less than $3.6 billion, about half that of U.S. companies ($7 billion), and less than the average profit of $4.1 billion of the 500 largest companies worldwide. The average return on sales for mainland Chinese companies on the list was 5.4 percent, lower than the 8.6 percent for U.S. companies, and the average return on net assets was 9.8 percent, lower than the 17 percent for U.S. companies.
The data show that there are 10 Chinese banks on the list, and the profits of these 10 banks account for 44% of the total profits of all mainland Chinese companies on the list. If we do not count the profits earned by banks, the average profit of the 114 non-bank companies on the list in mainland China in 2019 is only nearly $2.2 billion, as a comparison, the average profit of 113 U.S. non-bank companies is as high as $6.3 billion, which is nearly three times that of mainland companies.
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