First Pacific Bank Holding has kicked-off the reporting season for local banks by announcing a more than threefold increase in net profit to HK$192.88 million in the year to December 31.
But despite the headline-grabbing surge in bottom line profit, the result from the holding company of First Pacific Bank (FPB) may disappoint some investors.
Net profit was bolstered by an asset disposal and lower loan loss provisions, and flattered a more modest 43 per cent gain in core pre-provisioning and pre-tax profit to HK$412.82 million.
And stripped of a HK$41 million sum booked to 'other operating income' from the sale of a foreclosed property, core pre-tax operating profit would have been just 29 per cent up on the previous year's HK$287.64 million.
That contrasts with a 54 per cent increase in pre-provisioning profit at the halfway mark to HK$208.7 million, and expectations from analysts such as Nomura International's Anthony Lok that core profit would run out at HK$450 million for the full year - an increase of 56 per cent.
Putting the FPB profit recovery into perspective, Mr Lok pointed out that in 1997, the bank holding company's pre-crisis profit amounted to HK$390 million, with core operating profit before provisioning and tax of HK$532 million.
'So while we are witnessing a recovery, operating profit still remains well below the figure of three years ago,' said Mr Lok.
