Industrial Bank Has Further Room to Reduce Funding Costs and Increase Fee Income

As part of its 2021-26 strategy, Industrial Bank has a strategic focus on green banking, investment banking, and wealth management, which we think are its key strengths. In addition, the bank aims to reduce funding costs and strengthen its retail banking business, which have both been major weaknesses in the past. We expect CIB’s near-term earnings growth to be supported by its funding cost reduction, but it will be challenging to achieve its goal of transforming the retail business, given current fragile consumer confidence.