Bank puts focus on internet innovation

China CITIC Bank Corp Ltd is boosting its internet finance business, to enhance market performance, as profits based on interest-rate spreads are decreasing, according to senior executives.

"The Chinese banking industry is transforming as the profit model from earning interest spreads on deposits and loans cannot last. Innovation in internet finance is a key part of our retail banking business transformation," said Fang Heying, vice-president of China CITIC Bank.

China CITIC Bank has joined hands, Fang added, with Baidu to establish the online Baixin Bank, in which China CITIC Bank will hold a 70 percent stake and Baidu will have a 30 percent share. Baixin Bank is expected to open at the end of the year.

"Baixin Bank will exploit advantages of the two parties to serve individuals, micro- and small-sized enterprises and farmers," said Chang Ge, general manager of the retail banking department of China CITIC Bank. "Baixin Bank will use technology and data to set up an internet finance platform."

According to Chang, both Baixin Bank and China CITIC Bank will be complementary.

China CITIC Bank is also cooperating with bike-sharing company ofo to offer users financial services.

Under the partnership, announced on Thursday, the bank will provide tailor-made co-branded cards for ofo users. Card holders won't have to pay the 99 yuan ($14.4) deposit normally required to ride ofo bikes.

The two parties have also cooperated on payment and settlements, cross-border finance, fund trusteeships, credit support and public benefit activities.

"We have cooperated with companies such as Baidu, JD, Xiaomi, Huawei and ofo, and we will continue to seek cooperation with other partners," said Fang.

China CITIC Bank is also focusing on research and application regarding artificial intelligence and will roll out robo-adviser and smart customer services soon, according to Fang.