Chong Hing out to play catch up
Lender to leverage backing of new mainland parent for improved results
Chong Hing Bank is targeting double-digit growth in net profit and return on equity from an expected boost in cross-border business after the takeover of the bank by a mainland company.
Margaret Leung Ko May-yee, the newly appointed deputy chairman and managing director, said she felt earnings last year were "not enough".
The lender said net profit was HK$557 million, up a modest 2.5 per cent and below listed peers that posted at least 9 per cent growth in their net profits.
"The margin on lending to mainland firms will definitely be higher than to blue chips in Hong Kong," Leung said at a press conference to release the results.
Chong Hing hopes to use its relationship with its parent company, Yue Xiu, the biggest Guangzhou state-owned enterprise in the field, to grab most of the opportunities in the Pearl River Delta region.
Yue Xiu paid the Liu family HK$11.6 billion for a 75 per cent stake in the lender - representing a price-book ratio of 2.08 - in a deal completed this month.
Chong Hing was the second family-owned bank acquired by a mainland company, following China Merchants Bank's HK$4.7 billion purchase of Wing Lung Bank from the Wu family in 2009.