Hong Kong company reporting season

Agricultural Bank sees interim profit grow 3.3pc, as it curbs bad debt

Net profit for the period hits US$16.5 billion, well ahead of forecasts

PUBLISHED : Wednesday, 30 August, 2017, 6:41pm
UPDATED : Wednesday, 30 August, 2017, 6:41pm

Agricultural Bank of China, the mainland’s third-largest lender by assets, has beaten analyst estimates after posting a 3.3 per cent growth in profit for the first half year, and successfully putting a curb on its level of bad loans.

The Beijing-based bank’s net profit for the period ended on June 30 was 108.6 billion yuan (US$16.5 billion), compared with 105.1 billion yuan last time. Forecasts had suggested a 2 per cent year on year profit rise.

The bank said in its regulatory statement to the Hong Kong stock exchange that the second half performance was likely to remain “stable” in line with a favourable economy, and expected the “increasingly stringent regulatory environment” to continue.

“We will seize new opportunities arising from ongoing economic recovery,” it added.

The biggest mainland banks have been striving to curb bad loan growth since last year in tandem with the leadership’s call to deleverage an economy facing increased debt.

Agricultural Bank said its non-performing loans accounted for 2.19 per cent of total credit granted to customers by the end of June.

That figure translated into a 0.14 percentage point drop quarter on quarter, after its bad-loan ratio stood at 2.33 per cent at the end of March.