China expected to overtake U.S. as biggest banking economy by 2023

By Kim Young-gyo
HONG KONG, June 8 (Yonhap) -- With its financial sector steadily growing, China is expected to overtake the United States to become the world's biggest banking economy by 2023, a global consulting firm said Wednesday.
PricewaterhouseCoopers (PwC) also said in its "Banking in 2050" report that China's domestic banking assets are expected to exceed US$30 trillion by 2030.
"The study does not come as a surprise. Three of the largest banks in the world by market cap are Chinese," said Raymond Yung, PwC's financial services leader for China.
"Chinese banks remain financially sound thanks to the banking reforms put in place since the aftermath of the Asian financial crisis almost 15 years ago."
Meanwhile, India could overtake Japan to become the third-largest domestic banking economy by 2035, after China and the U.S., if it continues to pursue growth-friendly policies, PwC said.
In the longer term, India could potentially overtake China as China's growth rate slows down over time due to its rapidly aging population, a result of its one-child policy, the consulting firm added.
The report also predicted that by 2036, the combined domestic banking assets of the seven largest emerging economies -- China, India, Brazil, Russia, Mexico, Indonesia and Turkey -- will overtake those of the Group of Seven countries that include the U.S., Japan, Germany, Britain, France, Italy and Canada.
"In the banking world, this shift is happening even faster than anticipated. It appears to have been accelerated by the financial crisis as banks in the emerging market have been relatively shielded from the effects of declining asset values," Johan Hawksworth, PwC's chief economist, said.
PwC expected that global banking assets will quadruple to around $300 trillion by 2050.
ygkim@yna.co.kr