Top Biz News

Mainland profits jump for HK lender

(Shanghai Daily)
Updated: 2006-08-06 10:35

The Bank of East Asia, Hong Kong's third-largest lender, said?on?August 4?first-half profits from the mainland jumped 90 percent from the same period last year, helping drive up its interim net income by a third.

Mainland net profits hit HK$230 million (US$30.6 million) in the first six months and the lender expects half-year profits to top HK$1 billion within the next two years, Chairman David Li said at a press conference in Hong Kong yesterday.

The bank reported net profits of HK$1.57 billion, or HK$1.02 per share, for the six months ended June 30, compared with HK$1.18 billion, or HK$0.79 per share a year before, it said in a statement.

Loans to mainland companies jumped to HK$35.9 billion from HK$23.5 billion a year earlier, the statement said. Globally the bank approved HK$149.1 billion in loans during the quarter, up 7.5 percent on an annual basis.

The uptick in mainland business helped push the bank's net interest income, derived from lending, up to HK$2.31 billion in the first half of the year from HK$1.67 billion during the same period last year, it said.

"Bank of East Asia will broaden and enhance its business in China to capture the opportunities arising from the changing regulatory and operating environment," the statement said.

The bank's net interest margin, the difference between a bank's lending and deposit rates, hit 2.03 percent in the first half, up from 1.76 percent a year ago, it said. The bank also raised its interim dividend to HK$0.43 a share from HK$0.33 a share.

The Hong Kong-based bank, which operates 27 outlets on the mainland, is stepping up efforts to expand operations and enlarge its business scope as authorities plan to fully open the industry to overseas players later this year.