The Effect of Real Estate Prices on Chinese Bank Performance Accessible Data

Figure 1: Chinese real estate prices are volatile

Figure 1 shows monthly percent changes in Chinese real estate prices at an annual rate for tier 1, tier 2, and tier 3 or below cities. The figure shows that prior to 2015, the prices for all tiers of cities moved in conjunction to one another. However, from early 2015 to the end of 2016, the prices for tier 1 and tier 2 cities have grown much quicker than the prices in tier 3 or below cities. At end-2016 and early 2017, the prices changes have again converged to similar rates.

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Figure 2: Banks’ branch networks can differ significantly.

Figure 2 shows maps of Chinese bank branch distributions for (a) Bank of Beijing and (b) Bank of China, where the size of each circle represents the relative number of that bank’s branches in that city. The map for Bank of Beijing shows that its branches are concentrated in Beijing province, with much smaller numbers of branches in other, primarily southeastern, provinces. Meanwhile, the map for Bank of China shows branches concentrated in the southeastern region of China more broadly, with the highest concentrations in Guangdong and Jiangsu provinces.

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Last Update: April 27, 2018