BOC Hong Kong (Holdings) Limited (BOCHK) Wednesday announced that it recorded a consolidated profit attributable to shareholders of 11.96 billion HK dollars (1.53 billion US dollars) in 2004, an increase of 50.23 percent compared with 2003.

Earnings per share rose to 1.1315 HK dollars from 0.7532 HK dollars in 2003. "By capitalizing on our strengths and Hong Kong's economic recovery, the Group was able to deliver the highest profit attributable to shareholders and total annual dividend since its IPO in 2002," remarked Xiao Gang, chairman of the Company.

The growth in the group's profit was mainly attributable to a net provision write-back, gains on property revaluation, growth in non-interest income from wealth management business and disciplined cost control.

The Group's asset quality has shown substantial improvement. Both the non-performing loan (NPL) ratio and classified loan ratio dropped to 2.95 percent, down 2.83 and 2.87 percentage points respectively. This marked the lowest level of NPL ratio since 2001.

"In 2004, we continued to pursue with success our goal of sustaining growth and maximizing shareholder value through a focused business development strategy and enhanced corporate governance while keeping operating costs under control. We also embarked on major corporate reforms, paving the way for healthy development in the long run." he said.

Xiao Gang said "our retail banking and treasury businesses continued to perform satisfactorily as a result of an expanded wealth management clientele, increase in quality customers and higher demand for our innovative and customized services. On the corporate banking front, I am pleased to report that much progress has been made to de-risk our corporate lending portfolio, improve our loan mix and reduce the NPL ratio.

"Looking ahead, we are well positioned to take advantage of new opportunities that arise in 2005 from Hong Kong's economic upturn and the vibrant Chinese mainland economy. We will continue to grow our business and expand our local and Chinese mainland markets. Our goal is to pursue growth by maintaining a sharp competitive edge and by ensuring that we are relentless in our quest for excellence."

He Guangbei, vice chairman and chief executive of BOCHK, said" the economic recovery that Hong Kong is experiencing seems likely to extend into 2005 and benefit more business sectors, giving rise to higher demand for loans as well as banking and financial services, though competition in the sector would remain intense."

"The Group's enhanced management structure and corporate reforms will give us an edge in competing for new business, sustaining revenue and profit growth and excelling ourselves in key areas in the coming year. With our achievements in 2004, we will continue to perfect our development strategy, business model, risk management and corporate culture. Our primary objective is to achieve higher top line growth and ensure better return for shareholders," he said.

The group is a leading commercial banking group in Hong Kong. With 283 branches and about 450 ATMs and other delivery channels in Hong Kong.

(Xinhua News Agency March 24, 2005)