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Plenty of upside in China’s credit card market

Plenty of upside in China’s credit card market

(8 March 2006 – China) An indication of how far the Chinese credit card market has to run was given when Guandong Bank said the three million cards it had issued over the past three years accounted for between 20 and 30 percent of national market share. Using their numbers, this would indicate that there are roughly 10 million credit cards in circulation in China, which has a population of more than a billion.

Guandong Bank, which has Société Generale and Citigroup reportedly vying for a stake, said its credit card profit had doubled over the past year after becoming profitable for the first time in 2005.

The bank’s credit card division is run separately from the parent bank which has been handicapped by a non performing loan ratio of 22.84 percent.

The bank said its credit card default ratio stood at just 1.9 percent in 2005.

Guandong and Bank of China were the first Chinese banks to issue credit cards more than 20 years ago – an indication of the slow growth of the credit card market.
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