A strategic assessment of CITIC Indistrial Bank

Abstract

Important progress was made since Asia financial crisis in reforming China's stateowned banks. CIB is an example of Chinese banks taking decisive steps to address their respective problems. This thesis concludes that banking reform in China can not rely solely on macroeconomics measures. A great deal can be achieved through incremental improvements in banks' operation. At the same time, improvements in operation is also the ultimate guarantee for the long term sustainability of success in reforming Chinese banks. This thesis, using CIB as a case in point, points to recapitalization through incremental profit enhancement, management and organizational restructuring, implementation of management information system, development of marketing and distribution capabilities, and establishment of risk management system as the five effective mechanism to achieve results at individual bank level. This thesis also argues that CIB should reorganize its internal resources to make the transition to a consumer-centric banking model, and to re-evaluate and re-position its corporate banking business, taking into account the inherent and continually rising risk profile in the business.