WING Lung Bank has disappointed the market by posting a sluggish 10 per cent profit growth for last year and a lower-than-expected rate of inner reserves transfer. The 28-branch bank yesterday reported an attributable profit of $611.38 million. It transferred about 14.7 per cent of its profit to its hidden inner reserves, a rate which caught analysts by surprise. Defying the general trend of other banks to increase provision for bad and doubtful debt as a cushion against bad times, it decreased the provision by 40 per cent, from $32.7 million to $19.5 million. 'If it was not for the lowered [bad and doubtful debt] provision, the profit result could have been worse,' one analyst said. Cost-to-income ratio deteriorated slightly, from 31 per cent to 29 per cent. Earnings per share rose 10 per cent to $4.55. Wing Lung paid an interim dividend of 40 cents a share and planned to pay a final dividend of $1.32. The bank's general manager, Chung Che-shum, said stiff competition for wholesale deposits during the year pushed interest expenses up. 'Some banks are paying above HIBOR [Hong Kong interbank offered rate] on the big deposits,' Mr Chung said. The spread, the difference between what the bank charges its customers for funds and what it pays, was squeezed as interest rates rose, and the slowdown in the mortgage lending market also contributed to thin profit growth. Other operating income dropped eight per cent, partly caused by increased caution over foreign exchange dealings and book losses on government notes. Mr Chung said he expected a turnaround in the second half of the year. Credit cards, consumer loans, margin trading on foreign currencies and stocks would be introduced soon.