Chinese-funded banks' international credit ratings continue to improve, with Fitch upgrading China CITIC Bank's rating to "A-". Several major banks' rating outlooks returned to stable last year.

Ask AI · Fitch Recognizes CITIC Group’s Synergy Effects—How Big Is the Industry Impact?

Cailian Press, April 2 (Reporter Zou Juntao) Another joint-stock bank has earned Fitch’s “A-” rating.

On April 1, Fitch released a report, upgrading CITIC Bank’s long-term foreign currency issuer default rating (IDR) from “BBB+” to “A-”, with a stable outlook. On April 2, Fitch further upgraded its subsidiary CITIC Bank International’s long-term issuer rating from “BBB+” to “A-”, with a stable outlook.

Cailian Press learned from industry insiders that currently, “A-” is the highest rating level Fitch has assigned to domestic joint-stock banks; besides CITIC, another bank receiving this rating is China Merchants Bank. Above that, five large state-owned banks—Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank, and Bank of Communications—are rated “A” by Fitch.

A banking-industry analyst from a securities firm spoke with Cailian Press today, saying that this upgrade for CITIC Bank can be seen as continued confirmation by international rating agencies of the credit repair trend for China’s leading banks. “Starting in 2025, Fitch has gradually raised the outlooks of the five major state-owned banks and China Merchants Bank from ‘Negative’ to ‘Stable.’”

Regarding the rating upgrade, CITIC Bank responded to Cailian Press today that this reflects international rating agencies’ recognition of CITIC Bank’s strong operating performance, clear business logic, and deep business potential. It will help CITIC Bank further enhance its credit image in international capital markets and improve investor recognition.

CITIC Bank’s Fitch rating upgraded to “A-”, tying with China Merchants Bank as the top joint-stock-bank rating

In the report, Fitch said the reasons for the related rating upgrades are mainly based on CITIC Bank’s solid operating performance, strong shareholder support, and its level of systemic importance.

Fitch explained that CITIC Bank works closely with other financial subsidiaries of CITIC Group and non-financial enterprise subsidiaries in areas such as syndicated financing, customer referrals, and digital transformation. Especially after the establishment of CITIC Financial Holdings, cooperation has strengthened further, enhancing synergy effects.

In addition, CITIC Group has a long track record of supporting CITIC Bank with capital replenishment. For example, in early 2024, CITIC Financial Holdings converted RMB 260 billion worth of convertible bonds, raising CITIC Bank’s core tier-one capital adequacy ratio by about 40 basis points. Fitch believes these actions prove that CITIC Group has the strong commitment and capability to provide support in a timely manner when necessary.

It is understood that Fitch is one of the world’s three major credit rating agencies. According to its official website, as of now, only two domestic joint-stock banks have received Fitch’s long-term foreign currency issuer rating of “A-”. On July 18, 2025, Fitch released a report confirming that China Merchants Bank’s long-term foreign currency issuer rating is “A-”, with a stable outlook.

In addition, according to Wind statistics, regarding the remaining joint-stock banks’ international credit ratings, Shanghai Pudong Development Bank and Industrial Bank are rated “BBB” by Fitch, while Ping An Bank and Minsheng Bank are rated “BB+” by Fitch. In addition, China Everbright Bank has a Moody’s rating of “Baa2”, and Minsheng Bank has a Moody’s rating of “Baa3”.

The credit-repair trend for top-tier Chinese banks continues, which is expected to benefit broader financing channels

CITIC Bank said this rating upgrade is the second time its Fitch rating has been raised—from “BBB” to “BBB+” in 2023—following that earlier upgrade.

The aforementioned securities-firm banking-industry analyst believes that beyond serving as continued confirmation by international rating agencies of the credit repair trend for top-tier Chinese banks, the fact that, among joint-stock banks, only China Merchants Bank and CITIC Bank currently hold an “A-” rating also shows that international rating agencies remain cautious in their differentiation. “For other joint-stock banks, to achieve an upgrade in ratings, they need to continue improving areas such as asset quality, capital adequacy ratios, and the strength of shareholder support.”

Another rating-industry professional who requested anonymity told Cailian Press that Fitch’s upgrade of CITIC Bank reflects its recognition of CITIC Group’s “finance + industry” synergy model. “CITIC Bank is not an isolated banking entity; it is backed by CITIC Group’s large ecosystem spanning both finance and industry. This unique synergy effect receives positive points in Fitch’s rating model.”

In addition, industry analysts believe that improvements in international credit ratings for Chinese banks will help expand financing channels and lower the cost of issuing bonds overseas.

“Rating upgrades are generally viewed as a positive signal of improving credit quality. They may directly reduce banks’ financing costs and broaden their financing channels,” another securities-firm banking analyst told Cailian Press. “The dynamic way international credit rating agencies assess Chinese banks not only reflects the banks’ individual operating strength and risk profile, but also has a profound impact on their financing costs and channels in global markets.”

CITIC Bank said the upgraded Fitch rating “will help CITIC Bank further enhance its credit image in international capital markets and improve investor recognition.”

Wind data shows that over the past three years, the weighted average issuance yield for offshore bonds issued by domestic banks has shown a downward trend. In January this year, Industrial Bank’s Shanghai Pilot Free Trade Zone branch successfully issued offshore bonds using the “Yulan Bond” model. The bond issuance volume was RMB 3.0 billion, with a 3-year tenor and a coupon rate of 1.95%, narrowing by 50 basis points significantly compared with the initial price guidance.

(Cailian Press Reporter Zou Juntao)