Industrial Bank listing and wealth management business buoy lender's income
Hang Seng Bank's net earnings climbed a better than expected 43 per cent in the first half of the year, boosted by a stake in a mainland lender that went public and gains in its wealth management business.
Profit climbed to HK$8.86 billion, helped by a HK$1.46 billion gain from the listing of the mainland's Industrial Bank and growing fee income from wealth management.
The lender, a subsidiary of HSBC, beat market expectations for profit growth of about 30 per cent. Analysts said they had anticipated earnings from Industrial Bank's listing but were surprised by the gains in net interest income and wealth management fees.
Excluding the gain from Industrial Bank, operating profit rose 22.4 per cent to HK$7.77 billion year on year, the highest growth in 11 years.
Wealth management income grew 58.2 per cent year on year to HK$3.42 billion while net interest income rose 20.8 per cent to HK$6.69 billion.
However, Hang Seng's mainland operations recorded an unexpected drop in pre-tax profit of HK$40 million. Vice-chairman and chief executive Raymond Or Ching-fai declined to give the mainland profit figure but said it was 'insignificant'.
