Citic Bank and its domestic rivals are recording higher earnings as demand for loans continues to rise amid the country's soaring economy, and interest rate increases by the central bank to prevent overheating.

As a result, Citic Bank's net interest margin widened to 2.96 per cent in the first half from 2.46 per cent a year ago.

Rate increases also lifted its interest income from investments, particularly debt papers, to 2.2 billion yuan, up 39.37 per cent from a year ago.

Citic Bank's earnings were also driven by net fees and commissions, which surged 85 per cent to 605 million yuan. The mainland's stock market rally and rising personal incomes have boosted demand for its intermediary businesses including bank cards, consulting, advising and wealth management.

'The bullish stock market has resulted in the bank providing various innovative wealth management products to consolidate and expand the relationship with individual clients,' the bank said.

The lender issued 77,200 credit cards, up 108.5 per cent from a year earlier, bringing the total to more than three million cards.

With a bigger loan book, Citic Bank set aside 1.16 billion yuan as a provision against bad debts in the first half, up 23.09 per cent. Its non-performing loan ratio fell to 1.84 per cent at the end of June from 2.92 per cent a year ago and 2.5 per cent six months ago.

Its capital adequacy ratio jumped to 15.99 per cent from 9.41 per cent at the end of last year, after raising 44.8 billion yuan from a dual listing in Hong Kong and Shanghai in April.

Total deposits rose 7.7 per cent to 666.42 billion, while net assets doubled to 78.97 billion yuan.

Robust earnings

Citic Bank's first-half profit jumped 82.4 per cent to, in yuan 3.2b