BOCI Capital - part of BOC International Holdings, the Hong Kong-based investment banking arm of Bank of China - reported a 30 per cent plunge in net profit last year.
In a statement, it did not explain the reasons for the drop in earnings, which reached HK$109.64 million last year on sharply reduced interest income of HK$66.7 million.
This is despite BOCI Capital - alongside BOC Hong Kong (Holdings) - being last year's top arranger for loan syndication business in Hong Kong and China, according to local debt-paper publication Basis Point. About 48 transactions worth US$3 billion were arranged. How much of that US$3 billion was managed by BOCI Capital is unknown, but BOC Hong Kong is believed to have arranged the majority of it.
Industry sources said since the merger of BOC Hong Kong in 2001, loan syndication businesses had been carried out by BOC Hong Kong, leaving BOCI Capital to focus more on project financing. BOCI Capital officials could not be reached for comment yesterday.
BOC Hong Kong has detailed its competitive and co-operative relationships with BOCI Capital in Hong Kong's syndicated loan market.
In its listing prospectus issued last July, the bank said: 'To the extent that we and BOCI Capital have the same customers, we may compete with BOCI Capital for the role of arranger or manager.'