Bank of China

Bank of China Limited
	File:Bank of China.svg
	File:BOC Headquarters at Xidan (20171123140827).jpg Bank of China Headquarters located in Beijing, China, opened in 2001
Native name	中国银行股份有限公司
Company type	Public; State-owned
Traded as	Template:SSE (A share); Template:Hkse (H share); ; SSE 50 Component (A); Hang Seng Component (H);
ISIN	CNE000001N05; CNE1000001Z5;
Industry	Financial services
Founded	1905; 121 years ago (originally Da-Qing Bank); 1912; 114 years ago (renamed Bank of China); 1979; 47 years ago (re-established)
Founder	Chen Jintao
Headquarters	Beijing, China
Area served	Worldwide
Key people	Ge Haijiao (Chairman & President)
Products	Asset management; Banking; Commodities; Credit cards; Equities trading; Insurance; Investment management; Mortgage loans; Private equity; Wealth management;
Revenue	Increase Template:CNY; $73.23 billion (2018)
Operating income	Increase Template:CNY; $33.07 billion (2018)
Net income	Increase Template:CNY; $27.97 billion (2018)
Total assets	Increase Template:CNY; $3.091 trillion (2018)
Total equity	Increase Template:CNY; $234 billion (2018)
Owner	Government of the People's Republic of China
Number of employees	306,322 (2021)
Subsidiaries	Bank of China (Hong Kong); Bank of China (Canada);
Capital ratio	16.91% (2021)
Rating	A, A-1, Stable (S&P); A1, P-1, Stable (Moody's); A, F1+, Stable (Fitch Ratings)
Website	boc.cn; bankofchina.com; bank-of-china.com; bocusa.com

The Bank of China (BOC; ; Portuguese: Banco da China) is a Chinese state-owned multinational banking and financial services enterprise headquartered in Beijing. It is recognized as one of the "big four" banks in China and ranked as the nation's second-largest lending institution as of December 2019. On a global scale, it held the position of the ninth-largest bank by market capitalization and is identified as a systemically important financial institution by the Financial Stability Board. By the conclusion of 2020, BOC was ranked fourth worldwide in total assets, trailing only the other three leading Chinese banks.

Originally founded in 1912 through the renaming of the Qing dynasty’s Da-Qing Bank established in 1905, BOC was among the "Big Four" banks authorized to issue government currency until 1942. Following the Chinese Communist Revolution in 1949, most of its functions were absorbed by the People's Bank of China. Its principal operations were relocated to Taiwan, where it transitioned into the privatized International Commercial Bank of China in 1971. The Bank of China was reconstituted in 1979 as a separate entity spun off from the People's Bank of China amid early economic reform initiatives.

BOC maintains a major subsidiary based in Hong Kong, which operates under close managerial coordination and partners on insurance and securities offerings to strengthen its market foothold across the region.

Early 20th century

The Qing dynasty government founded the Da-Qing Bank in Beijing in 1905. After the establishment of the Republic of China in 1912, financial reforms were led by Chen Jintao under President Sun Yat-sen, transforming Da-Qing Bank into the Bank of China, with Chen recognized as its founder.

In 1917, Tsuyee Pei inaugurated the Bank of China's branch in Hong Kong. The bank relocated its headquarters from Beijing to Shanghai in 1928. Earlier, in 1920, it created the Investigative Office of the Bank of China, which was China's first institution dedicated to banking research.

International growth followed with a London branch opening in 1929, which handled government foreign debt and foreign currency exchange. Additional branches were set up in Osaka (1931), Singapore (1936), and an agency established in New York City. To support wartime logistics after 1937, the bank expanded throughout Southeast Asia with branches in Batavia, Penang, Kuala Lumpur, among others. However, Japanese military advances led to closures between 1941 and 1942, leaving only London, New York, Calcutta, and Bombay branches operational. Despite these challenges, new offices opened in Sydney, Liverpool, Havana, and possibly Karachi.

By late 1942, the bank lost its authority to issue banknotes as the Central Bank of China assumed exclusive control over currency issuance within Nationalist-controlled areas.

Following World War II, branches resumed operations in Hong Kong, Singapore, Haiphong (later relocated to Saigon), Rangoon, Kuala Lumpur, Penang, and Jakarta. The Osaka branch was closed while a Tokyo sub-branch was established. By 1947, additional agencies had been launched in Bangkok, Chittagong, and Tokyo.

After the Communist Party's triumph in 1950, some overseas branches such as those in Hong Kong, Singapore, and London remained affiliated with the Beijing-based Bank of China. Meanwhile, others including New York and Tokyo aligned with the Taipei-based Bank of China (renamed International Commercial Bank of China in 1971). Several branches were nationalized: Rangoon in 1963; Karachi and Chittagong transferred to National Bank of Pakistan in 1971; Saigon in 1975; and Phnom Penh came under Khmer Rouge control.

Since 1979

In 1978, the People's Bank of China began divesting its commercial banking roles and re-established the Bank of China (BOC) in 1979 with a renewed focus on international finance. That year marked the opening of a Luxembourg branch that served as BOC’s European headquarters throughout the 1990s. The bank further expanded by establishing branches in New York (1981) and Paris (1985), joined the LBMA in 1987, and opened a representative office in Toronto in 1992 which was upgraded to Schedule II bank status by 1993.

During China's Reform and Opening Up period, BOC created its Institute of International Finance to shape both corporate strategy and governmental policy.

2000s

BOC encountered difficulties operating in Singapore. From 2001 to 2007, it shut down Kwangtung Provincial Bank and Bank of China Futures Pte Ltd, implemented workforce reductions and salary cuts, and replaced branch head Zhu Hua due to underperformance. In 2008, a senior executive was investigated for involvement with multi-level marketing schemes that implicated employees. The following year saw the opening of People's Park Remittance Centre in Singapore while Sunday banking ceased at Chinatown Sub-branch.

Prior to its initial public offering (IPO), BOC secured key strategic investments including $3.1 billion from the Royal Bank of Scotland Group PLC alongside stakes from UBS AG and Temasek Holdings. The bank was also subject to a U.S. investigation regarding money laundering linked to superdollars. On , BOC’s listing on the Hong Kong Stock Exchange raised US$9.7 billion—the largest IPO since 2000 and fourth largest globally—with total proceeds reaching US$11.2 billion after overallotment options were exercised. In July 2006, BOC launched an IPO on Shanghai’s A Stock Exchange raising RMB20 billion (approximately US$2.5 billion). In 2007, BOC acquired Singapore Airlines’ shareholding in Singapore Aircraft Leasing Enterprise and rebranded it as BOC Aviation.

By December 2005, mainland China accounted for 60% of BOC’s profits and held 76% of its assets.

In 2008, BOC purchased a 20% equity interest in Compagnie Financière Edmond de Rothschild for €236.3 million (US$340 million). The bank further extended its presence into São Paulo, Maputo, and Penang by 2009.

As of that year, BOC ranked as China’s second-largest lender and stood fifth worldwide by market capitalization. Once fully state-owned through China Central Huijin and the National Council for Social Security Fund (SSF), it now has a free float exceeding 26% following its June 2006 IPO.

2010s

In December 2010, the Bank of China’s New York branch became the first major Chinese financial institution to offer renminbi-denominated products to U.S. customers.

By 2011, Forbes had ranked the Bank of China as the fourth-largest company worldwide.

The bank broadened its global presence by launching branches in Taiwan (2012), Malaysia (its sixth branch in Bandar Puteri Puchong, 2012), Stockholm (2012), and Lisbon (2013). Amid the 2013 Korean crisis, BoC halted dealings with a North Korean bank accused by the United States of funding missile and nuclear initiatives. That same year, BoC inaugurated a branch in Montreal, increasing its Canadian footprint to 10 branches located in major cities such as Toronto and Vancouver.

In 2015, BoC became one of eight members participating in the London Bullion Market Association’s gold price auction and introduced two international commodity centers in Singapore, marking the first time a Chinese bank established such centers outside China. From 2015 to 2020, BoC provided over US$185.1 billion in financing for projects under the Belt and Road Initiative.

Additional growth included new branches in Brunei and Mauritius in 2016, with the latter representing BoC’s status as the first Chinese-backed bank operating there. In 2017, the bank secured approval to run a deposit bank in Turkey and opened its inaugural Pakistani branch in Karachi.

BoC stands as China’s most internationally engaged bank, maintaining branches across every inhabited continent. By 2017, it operated in 27 countries including Australia, Canada, the United Kingdom, France, Germany, Italy, Russia, the United States, Brazil, Japan, Singapore, Taiwan, Malaysia, South Africa, among others. Despite this extensive network, foreign operations contributed less than 4% to the bank’s total profits and assets.

In 2019, BoC launched its own think tank known as the Bank of China Research Institute.

2020s

In 2022, BoC was ranked #42 among global organizations according to Fortune magazine.

In August 2023, Reuters revealed that BoC had commenced a nationwide reform aimed at narrowing salary gaps between employees and mid- to senior-level managers. This initiative aligns with the common prosperity policy advocated by Chinese leader Xi Jinping. Following an audit by the Central Commission for Discipline Inspection, the bank implemented a "salary management system reform plan" targeting "wealth inequality." According to this plan, wages for staff below mid-management would increase by 10% to 15%, while compensation for higher-level managers would be reduced by a similar margin.

As of January 2024, BoC intended to issue total loss-absorbing capacity (TLAC) bonds totaling 150 billion yuan ($21 billion), becoming the first state-owned Chinese bank to fulfill funding gap requirements ahead of the 2025 deadline.

In June 2024, BoC complied with international sanctions related to the Russian invasion of Ukraine, suspending transactions with Russian banks under sanction. At that time, trade between Russia and China accounted for more than one-third of Russia’s export volume.

Hong Kong

Bank of China commenced operations in Hong Kong in 1917 and was designated as the third note-issuing bank there in 1994; this role extended to Macau in 1995.

In 2001, BoC consolidated its Hong Kong operations into Bank of China (Hong Kong) (BOCHK), which went public on the Hong Kong Stock Exchange in October 2002 with approximately two-thirds of shares available to public investors. BOCHK is headquartered in the iconic Bank of China Tower, a landmark designed by I.M. Pei that opened in 1990 as Hong Kong’s tallest skyscraper at that time.

On June 1, 2006, BOCHK executed the largest initial public offering on the Hong Kong Stock Exchange since 2000 by raising US$9.7 billion. The IPO attracted retail subscription orders totaling HK$286 billion (US$36.7 billion), making it the most oversubscribed offering in exchange history at roughly 76 times demand. Despite concerns over non-performing loans within the portfolio, investor enthusiasm remained high; shares surged by 15% on debut from HK$2.95 to HK$3.40.

In 2008, Bank of China was honored with Deal of the Year - Debt Market Deal of the Year at the ALB Hong Kong Law Awards.

Canada

Bank of China (Canada) (BOCC) serves as the Canadian branch of BOC, founded in 1993 after establishing a representative office in Toronto in 1992. Registered under Schedule II of Canada's Bank Act, BOCC provides a range of personal and business banking solutions such as deposit accounts, remittance services (including bank drafts and wire transfers), lending products, mortgages, currency exchange, and support with visa applications for travel to China.

The bank maintains ten locations throughout Ontario—including Markham, downtown Toronto, North York, Scarborough, and Mississauga—as well as branches in Vancouver, Montreal, and Calgary. Formerly, it operated additional branches in Burnaby and Richmond. BOCC is affiliated with the Canadian Bankers Association, insured by the Canada Deposit Insurance Corporation, and integrates with Interac for ATM withdrawals and debit card payments.

Banknotes

While Bank of China is not a central bank, it holds authorization to issue currency within two of China's Special Administrative Regions. Historically, until 1942, it issued notes on behalf of the Government of the Republic of China in mainland China. Presently, Bank of China produces banknotes for Hong Kong and Macau (under the Portuguese title "Banco da China, Sucursal de Macau"), alongside other commercial banks operating in these territories.

Ownership

As reported on 30 September 2015, the principal shareholders of Bank of China's ordinary shares (both A shares and H shares) included:

China Central Huijin (government investment entity): 64.63% (A shares)
HKSCC Nominees Limited (nominee account): 27.78% (H shares)
China Securities Finance (state-owned legal person): 2.90% (A shares)

Regarding preference shares (both domestic and offshore):

The Bank of New York Mellon (custodian bank): 39.96% (offshore)
China Mobile Communications: 18.01% (domestic)
China National Tobacco Corporation: 5.00% (domestic)
Zhongwei Real Estate: 3.00% (domestic)

Leadership

Wu Dingchang, administrator February – December 1912
Sun Duosen, president December 1912 – June 1913
Xiong Xiling, president 1913 – 1916
Xu Enyuan, president June 1916 – June 1917
Sun Duosen, president in absentia June – July 1917
Li Sihao, president June – July 1917
Wang Kemin, president July 1917 – February 1918 and June 1922 – October 1923
Feng Gengguang, president February 1918 – June 1922; acting president 1926 – November 1928
Jin Huan, president October 1923 – November 1928
Li Fusun, chairman November 1928 – April 1935
Chang Kia-ngau, general manager November 1928 – April 1935
T. V. Soong, chairman April 1935 – February 1944
H. H. Kung, chairman February 1944 – 1948
Song Hanzhang, general manager 1935 – 1948; managing director 1948 – 1949
Xi Demao, general manager 1948 – 1949
Nan Hanchen, chairman post-1949
Gong Yinbing, general manager 1949 – 1973
Bu Ming, president June 1979 – April 1982; subsequently chairman
Chang Yanqing, acting president and chairman early 1980s
Jin Deqin, president April 1982 – February 1985
Wang Deyan, president June 1985 – November 1993
Wang Xuebing, president November 1993 – February 2000; chairman starting May 1995
Liu Mingkang, chairman February 2000 – March 2003
Li Lihui, president August 2004 – January 2014
Chen Siqing, president February 2014 – August 2017; chairman August 2017 – April 2019
Liu Lian'ge, president June 2018 – June 2019; chairman June 2019 – March 2023
Wang Jiang, president December 2019 – February 2021
Liu Jin, president April 2021 – August 2024

Performance guarantee dispute in Poland

Following COVEC's withdrawal from the completion of the A2 highway project, the Bank of China was anticipated to fulfill a performance guarantee obligation to Poland’s road authority, GDDKiA. Nevertheless, together with the Export-Import Bank of China, it declined to make the payment; only Deutsche Bank complied after a judicial decision mandated it.

Wultz v. Bank of China case

In 2008, the family of Daniel Wultz, an American teenager who lost his life in a 2006 terrorist incident in Israel, initiated legal action against Bank of China in a U.S. District Court. The proceedings were transferred to the Southern District of New York, where the lawsuit remains active. In 2012, a court order required Bank of China to submit discovery materials.

Accusations of funding Hamas

In 2012, relatives of eight victims from the 2008 Mercaz HaRav massacre filed a $1 billion lawsuit against Bank of China, asserting that its New York branch transferred millions to Hamas leaders based in Syria and Iran in 2003. The bank rejected these allegations, emphasizing its strict adherence to United Nations regulations on anti-money laundering and counter-terrorism financing within all jurisdictions it operates.

Resources

Bank of China, A History of the Bank of China, 1912–1949, Beijing: 1999.

External links