NewConstruction Bank posts first-half earnings surprise as it keeps bad loans in check
First-half net profit rises to 133.9 billion yuan, beating analysts’ estimates
China Construction Bank reported a surprising 1 per cent rise in interim profit, as it kept its non-performing loans in check during the first six months, becoming the first among the country’s four biggest lenders to turn prudential management to sound financial results.
Net profit rose to 133.9 billion yuan (HK$156 billion) in the first half, more than the 131.8 billion yuan average estimate by three analysts polled by the South China Morning Post.
Net interest income at the Beijing-based bank fell 6 per cent to 210.99 billion yuan, while net fees and commission income rose 5.6 per cent to 67.19 billion yuan.
Construction Bank “deserves to be ahead of the industry in showing a decline in new non-performing loans,” said China Merchants Securities’ head of financials research Ma Kunpeng. The bank “has been ahead in recognising risks and writing off non-performing loans these past couple of years,’ he said.
The bank has been closely watching its non-performing loans from the retail and wholesale sectors. Exposure from property, mining and manufacturers are otherwise under watch.