Bank of China, BoCom see profits rise as shadow banking crackdown drives traditional lenders’ revival
Better loan growth and fewer bad debts help ‘Big Five’ lenders to higher profits
Bank of China and Bank of Communications (BoCom) reported a better than expected result on Thursday, bringing the banking results season to an end.
All five of the mainland’s biggest lenders saw improved results this year as a result of better loan growth and fewer bad debts.
Bank of China, the country’s fourth-largest bank by assets, reported a net profit of 172.41 billion yuan (US$27.41 billion) for 2017, up 4.7 per cent from 164.58 billion yuan the previous year. That is better than the consensus estimate among analysts polled by Bloomberg, who predicted that its net profit would rise by 1.7 per cent to 167.348 billion yuan.
Bank of China (Hong Kong), the lender’s local arm, reported a worse than expected result of HK$28.48 billion (US$3.62 billion) for 2017, up 16 per cent from HK$24.57 billion a year earlier. This is below the estimate of a 27 per cent increase forecast by Bloomberg analysts.
Bank of Communications, the fifth-biggest mainland bank in terms of assets, reported a profit of 70.22 billion yuan for 2017, an improvement of 4.5 per cent over 67.21 billion yuan in 2016. This is better than the 66.068 billion yuan estimated by analysts in a Bloomberg survey.
