Ka Wah Bank, which yesterday posted a 26 per cent increase in full-year net profit, has raised its provisions for the year more than fourfold to $210.08 million from $50.49 million.
The bank, which also announced a one-for-two bonus share issue, said it had implemented more rigorous and conservative credit and risk management policies, which sparked the higher provisions charge, in anticipation of an economic slowdown and declining asset values.
'We should continue to pursue the policy of matching our loans and credit exposure by a more than sufficient provision account,' chairman Peter Kwok Viem said in the results statement.
Attributable profit for the year to December was $516.01 million, up from $409.45 million a year ago.
Despite the apparently healthy growth, the bank set a cautious tone for its future.
'Setting specific targets for growth is difficult in times of volatility. But our management is optimistic about our prospects in a year which suggests caution in the market,' Mr Kwok said.
He added that the bank was proposing to change its name to 'Citic Ka Wah Bank' at its upcoming annual meeting to better reflect its 'revitalised image and culture, and the strengthened bonding with its majority shareholder'.
