Profits at ICBC, BoCom rise
0 Comment(s)
Print
E-mail
China Daily, October 28, 2011
The Industrial and Commercial Bank of China and the Bank of Communications yesterday reported third-quarter earnings growth of about 30 percent as they benefited from better pricing margins on loans and wider non-interest income.
Net profit in the July-September quarter at Beijing-based ICBC, the world's largest bank by market value, rose 28 percent to 54.4 billion yuan (US$8.5 billion) while Shanghai-based BoCom, the fifth-biggest domestic lender, saw a 31 percent jump in earnings to 12 billion yuan in the period.
ICBC's net interest income, or revenue from lending minus payments to depositors, grew 18 percent to 92.6 billion yuan while fee income jumped 39 percent to 24.5 billion yuan between July and September.
At BoCom, net interest income gained 23 percent to 26.6 billion yuan while fee income surged 41 percent to 5 billion yuan.
The banks are benefiting from a wider interest margin as they are able to charge higher rates amid China's tight monetary policy. China has raised interest rates five times since October last year, helping banks to enjoy a widening interest spread.
She Minhua, a Zhong De Securities Co analyst, said yesterday that the banks' performance is up to expectations.
"But banks face the challenges of rising bad assets amid concerns over a correction in home prices and a slowdown in economic growth," he cautioned.
BoCom said it is closely monitoring the housing market.
Go to Forum >>0 Comment(s)