Wu Wei: Breaking from convention


Matthew Thomas
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As part of Euromoney's 50th anniversary coverage, we profile some of the biggest names that we interviewed for our May Asia focus.

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Bank of Communications (BoComm) has a long and distinct history in China. Founded in 1908, it was one of the four note-issuing banks in China. After the establishment of the People’s Republic of China, it played a key role in financial reform and was restructured in 1986/87 to help revitalize Shanghai and build it into a financial centre.

“We were the first one to break from the conventional Chinese banking system and to build a real commercial banking system,” says executive vice-president and chief financial officer Wu Wei. The sale of a 19.9% stake to HSBC in 2004 was a landmark development. “Bank of Communications has always been the pioneer of reform.”

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Wu Wei, BoComm

Today, an ambition is to build the best wealth management bank in the country, using technology for momentum and to control risk. Wu says China’s powerful fintech companies offer: “Both competition and cooperation with them – more competition, I think.”

He says the bank has reduced fees heavily and is competitive. “Compared with fintech companies, there is not a big difference in fee charges.”

Besides, he says, fintechs are now starting to charge for services that were once free. “Our bank is not afraid of competition with fintech companies as long as we are in a fair regulatory environment with them.”


A reform package was announced by the State Council in 2015, seeking to revitalize and upgrade the bank’s internal structures “to unleash more vitality,” as Wu puts it. “The core question is the change of the business of our bank.” That means new, specialized products, streamlined internal management and better corporate governance. Today the bank emphasizes three things: a professional management system, IT upgrades with a focus on big data and digitization, and credit and risk management.

Deleveraging in the Chinese economy, says Wu, is not harming the bank. “On the whole the impact is rather limited. Deleveraging is bringing us both challenges and opportunities to do new business.” He thinks it has been successful. “In the government sector it has already achieved tremendous results. Now for local governments, the only way for them to raise funds is to issue bonds, so they can manage in a more transparent way.”

This has an impact for BoComm; where previously most loans went to governments, now only 20% do so, with the bulk going to individual and corporate customers. How does that compare with 10 years ago? “Maybe at peak times in history it was almost 100% government.”

The HSBC partnership has taught BoComm a lot about risk management, Wu says, and the relationship was reaffirmed in top-level meetings last year. But with HSBC now running a majority-owned joint venture on the mainland, will the relationship turn competitive?

“For now we still see more collaboration than competition,” says Wu.