Many took Wells Fargos ousting of Industrial and Commercial Bank of China as the worlds largest bank by market capitalization as a sign of the times. It signalled the much talked about resurrection of the US and the equally mooted fading of the Chinese dream, they concluded.
It is almost six years since ICBC ascended to the top of the banking profitability chart, doing so by focusing largely on the potential of its home market. With hindsight, it is no coincidence that it reached this position just as the US was entering the worst of the financial crisis.
That the US has rebounded strongly is not in question. But those bearish on China might have overstated things, even given growth concerns, particularly if you take the fortunes of banks as a measure of overall strength.
The largest of these is ICBC. Its profits of $37.8 billion last year were comfortably more than double those of Wells Fargo. The other three of the big-four Chinese banks also handily out-earned international rivals.
China naysayers claim that profit numbers from the big-four, government-owned Chinese banks are not to be trusted.
This lack of trust in the numbers means that western banks in Asia eye Chinese competitors with thinly veiled suspicion and tend to dismiss the competition that they pose. It is convenient for them to scoff at the efforts of Chinese institutions, constantly highlighting a lack of what they see as proper corporate governance and transparency as the caveat to outsized profitability.
But on the assumption that innocence abides until guilt is proved, profits dont lie. And the argument could just as easily be made that western banks can be every bit as creative with their accounting as they presume Chinese institutions are. Beyond financial performance, league tables also suggest that Chinese banks, and a handful of powerful local players from elsewhere in Asia, are posing a clear and present threat to the expansion plans of global banks. That they choose to focus their efforts closer to home rather than going global smacks more of realism and sound management than a lack of ambition.