Log in
Login
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  Equities  >  SHANGHAI STOCK EXCHANGE  >  Bank of China Limited    601988   CNE000001N05

End-of-day quote. End-of-day quote  - 07/22
3.3 CNY   --.--%
07/21 BANK OF CHINA : Luxembourg foreign minister holds talks with Wang Yi..
07/20 BOCHK Today Brings Apple Pay To Cardholders Offering the Easy, Se..
07/20 BANK OF CHINA : SWIFT announces distinguished speaker line-up for Gr..
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector news 

China Banks See Slower Interest And Fee Income Growth

share with twitter share with LinkedIn share with facebook
share via e-mail
0
04/27/2012 | 02:05pm CEST

-- China's five largest banks report combined first-quarter net profit of CNY208.94 billion

-- Interest and fee income growth decelerated in the first quarter

-- Analysts expect the banks to report net profit growth of 14% on average in 2012, down from 26% growth in 2011

(Combines earlier stories, adds a bank executive's comment in the 7th paragraph, adds analysts comments in the 8th, 9th and last paragraphs)

China's five largest banks continued to crank out bumper profit in the first quarter, but the key engines for their earnings growth, interest and fee income, started to run out of steam after supercharged expansion in recent years.

Friday, Industrial & Commercial Bank of China Ltd. (1398.HK), the largest bank by assets on the mainland, said its January-March net profit grew 14% to CNY61.34 billion ($9.77 billion). Net profit in China Construction Bank Corp. (0939.HK), Agricultural Bank of China Ltd. (1288.HK) and Bank of Communications Co. (3328.HK) rose by 9.2%, 28% and 20% to CNY51.51 billion, CNY43.45 billion and CNY15.88 billion respectively.

On Thursday, Bank of China reported a 10% gain in first-quarter net profit to CNY36.76 billion.

The results are strong compared to most of their Western peers that are still struggling with the anemic economic recovery in their respective markets. But their earnings reports offered some signs of uncertainty for China's banking sector as the world's second-largest economy continues to cool.

Highly dependent on making loans to fuel investment, banks' figures suggest they are taking a hit as businessmen grow cautious amid an economic slowdown.

While ICBC's net interest income earned on lending rose 16% to CNY98.82 billion, the rate slowed from a 25% rise in the year-earlier period. Bank of Communications' net interest margin, a key gauge of the profitability of banks' lending business, increased slightly to 2.60% in the first quarter from 2.59% in the fourth quarter of last year.

Given the current economic situation, "it's impossible to see a big increase in the bank's interest margin this year," said Yu Yali, chief finance officer at Bank of Communications.

"Net interest margins are likely to decline slightly across the board. We believe this reflects banks' ability to price loans has peaked or come under pressure amid weakening demand and continuing competition for deposits," Citigroup said in a recent note.

Analysts forecast China's five largest banks will report net profit growth of 14% on average in 2012, down from 26% growth in 2011.

Adding to the lackluster outlook is a sharp slowdown in banks' fee income growth. In recent years, Chinese banks have been gearing up to diversify their revenue streams into fee-based business segments, such as credit card and advisory services.

But higher consumer fees have fueled discontent against Chinese banks that have already come under criticism for enjoying a state-mandated fat interest margin and a lack of lending to small businesses.

In February, China's central bank, the state planning agency and the banking regulator barred bank subsidiaries from setting their own charges, stipulating that all service fees must be decided at the head office.

The move seems to have had some impact. ICBC's net fee and commission income grew merely 10% to CNY28.62 billion in the first quarter, down from the 42% increase in the year-earlier period. Such income posted by Bank of Communications Co. rose 22%, compared to 43% growth in the same period of last year.

"We're going to see a slowdown in the growth of Chinese banks' intermediary business segments this year due to a combination of relatively higher base numbers last year and stricter regulatory enforcement," said GF Securities analyst Mu Hua.

-Rose Yu and Yue Li contributed to this article, Dow Jones Newswires; 8621 6120-1200; rose.yu@dowjones.com

share with twitter share with LinkedIn share with facebook
share via e-mail
0
Latest news on BANK OF CHINA LIMITED
07/21 BANK OF CHINA : Luxembourg foreign minister holds talks with Wang Yi in Beijing
07/20 BOCHK Today Brings Apple Pay To Cardholders Offering the Easy, Secure & Priva..
07/20 BANK OF CHINA : SWIFT announces distinguished speaker line-up for Greater China ..
07/20 Bank stocks look an easy choice as lenders fight it out
07/19 BRICS bank issues first bond to fund green projects
07/18 ICTSI lines up $300m in financing for Australian terminal VICT
07/16 Banks to lift their risk game
07/15 Shenzhen House Loan Interest Rate Discount Adjusted to 10%
07/13 BRICS bank issues yuan-denominated green bonds
07/12 China Vanke Seeks HKD1.8bn Loans for HK Projects
More news
Sector news : Banks - NEC
11:45aDJFuel Glut Keeps Pressure on Refiners' Profit
08:49aDJBanks' Profit Margins Fall -- WSJ
07/22DJFosun Group Insurance Unit Files for IPO in U.S.
07/22 Exclusive - De Beers puts Canadian Snap Lake diamond mine up for sale
07/22DJPayPal Shares Slide on Visa Deal
More sector news : Banks - NEC
News from SeekingAlpha
06/17 Demographics Is Destiny - The Big Picture In China
05/23 What You Need To Know About China
04/03 Why Wells Fargo Is The Buffett Bank
03/11 Who Are The Global Systemically Important Banks And What They Mean
01/07 BOC Aviation places order for 30 Airbus planes
Advertisement
Financials ( CNY)
Sales 2016 493 533 M
EBIT 2016 268 289 M
Net income 2016 168 396 M
Debt 2016 99 714 M
Yield 2016 5,15%
P/E ratio 2016 5,80
P/E ratio 2017 5,74
EV / Sales 2016 2,15x
EV / Sales 2017 2,04x
Capitalization 962 148 M
More Financials
Chart BANK OF CHINA LIMITED
Duration : Period :
Bank of China Limited Technical Analysis Chart | 601988 | CNE000001N05 | 4-Traders
Full-screen chart
Technical analysis trends BANK OF CHINA LIM...
Short TermMid-TermLong Term
TrendsNeutralNeutralBearish
Technical analysis
Income Statement Evolution
More Financials
Consensus
Sell
Buy
Mean consensus OUTPERFORM
Number of Analysts 16
Average target price 4,14  CNY
Spread / Average Target 25%
Consensus details
EPS Revisions
More Estimates Revisions
Managers
NameTitle
Si Qing Chen President
Jun Li Chairman-Supervisory Board
Guo Li Tian Chairman
Man Yiu Chow Independent Non-Executive Director
Jackson Peter Tai Independent Non-Executive Director
More about the company
Sector and Competitors
1st jan.Capitalization (M$)
BANK OF CHINA LIMITED-17.71%143 870
WELLS FARGO & CO-11.11%245 323
JPMORGAN CHASE & CO.-3.01%234 172
INDUSTRIAL AND COML BA..-6.55%221 575
CHINA CONSTRUCTION BAN..-12.28%175 483
BANK OF AMERICA CORP-14.56%147 710
More Results