INDUSTRIAL and Commercial Bank of China (Stock Code: 601398) expects to double the number of its credit cards this year amid growing demand for purchases by plastic.
The country's biggest bank expects to issue about 10 million new cards this year. Last year there were 10.46 million, Li Weiping, president of the Beijing-based bank's card center, said yesterday in Shanghai.
The bank had previously set a target of 15 million credit cards this year but as that was reached on May 25, a higher target is expected, he said.
"For a conservative expectation, a target of 18 million cards at the end of this year is made," he said. "But we are also expecting to fulfill the 20 million target."
Credit cards will be the most important consumer credit product after mortgages, with profit forecast to reach US$1.6 billion by 2013, accounting for 22 percent of total consumer credit profits, New York-based McKinsey & Consulting firm said.
Banks earn interest when card holders roll over payments, and also make money from annual fees and charges to merchants. The market is growing so rapidly that ICBC has to revise its targets.
Li said card numbers were not the only gauge of the business. The bank expects card-based transactions to reach between 140 billion yuan (US$18.4 billion) and 150 billion yuan this year.
ICBC has 27 percent of the market for credit cards in China's mainland, with card-based transactions giving 30.3 percent of the total.
The bank yesterday issued a co-branded corporate credit card in Shanghai with Staples and American Express, to target a growing need from corporate clients.
The bank's shares ended at 5.53 yuan yesterday in Shanghai, up 0.73 percent. Its shares have dropped 12 percent this year.