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BEA earnings dive 52pc as crisis bites

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Bank blames weakness, turmoil in debt markets

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Shares of Bank of East Asia fell to their lowest level in almost two years yesterday after the lender posted a 52.37 per cent slump in first-half earnings and forecast a difficult period ahead for the world economy.

The stock dropped as much as 12.15 per cent after the earnings announcement missed analyst forecasts by a wide margin. It closed down 8.29 per cent at HK$33.20, the lowest since August 2006.

This may be a difficult week for bank profits as the subprime crisis bites deeper. HSBC Holdings on Monday reported a 29.1 per cent slide in net earnings for the first half.

BEA's net profit was HK$894 million, compared with HK$1.88 billion in the first half of last year. Most analysts were expecting earnings to drop between 6.3 per cent and 20 per cent.

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David Li Kwok-po, the chairman and chief executive of BEA, cited continuing market weakness as a key reason for the poor results.

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