Bank drops on lower growth in earnings
By Zhang Fengming |
March 29, 2011, Tuesday
|
Print Edition
Print Edition
SHARES of China Construction Bank fell yesterday in Shanghai after the lender reported profit grew less than expected in 2010.
The world's second-biggest bank by market value lost 0.2 percent to 5.03 yuan (76 US cents) yesterday, while the Shanghai Composite Index gained 0.2 percent to 2,984.01.
The Beijing-based bank said its 2010 net income climbed to 134.8 billion yuan (US$20.6 billion), or 0.56 yuan a share, from 106.76 billion, or 0.45 yuan a share a year ago, based on international accounting standard. But the net profit fell short of the 139 billion yuan average of 17 estimates compiled by Bloomberg News.
The bank, established in 1954 to fund housing and infrastructure in China, set aside 29.3 billion yuan in provisions against bad debts last year, up from 25.5 billion yuan in 2009. It raised its provisions ratio to 2.52 percent, above the regulatory minimum requirement of 2.5 percent.
The bank's bad loan ratio dropped to 1.14 percent at the end of 2010, down from 1.5 percent a year ago.
China International Capital Corp said in a research note yesterday that the prudent higher provision means the bank is easing pressure on the costs of future credit.
The bank's outstanding loans rose to 5.53 trillion yuan at the end of December, up 17.8 percent from the start of 2010.
It's slower than 2009's expansion of 27 percent when China recorded new yuan loans of 9.5 trillion yuan. China's total new yuan lending slowed to 7.95 trillion yuan in 2010.
The world's second-biggest bank by market value lost 0.2 percent to 5.03 yuan (76 US cents) yesterday, while the Shanghai Composite Index gained 0.2 percent to 2,984.01.
The Beijing-based bank said its 2010 net income climbed to 134.8 billion yuan (US$20.6 billion), or 0.56 yuan a share, from 106.76 billion, or 0.45 yuan a share a year ago, based on international accounting standard. But the net profit fell short of the 139 billion yuan average of 17 estimates compiled by Bloomberg News.
The bank, established in 1954 to fund housing and infrastructure in China, set aside 29.3 billion yuan in provisions against bad debts last year, up from 25.5 billion yuan in 2009. It raised its provisions ratio to 2.52 percent, above the regulatory minimum requirement of 2.5 percent.
The bank's bad loan ratio dropped to 1.14 percent at the end of 2010, down from 1.5 percent a year ago.
China International Capital Corp said in a research note yesterday that the prudent higher provision means the bank is easing pressure on the costs of future credit.
The bank's outstanding loans rose to 5.53 trillion yuan at the end of December, up 17.8 percent from the start of 2010.
It's slower than 2009's expansion of 27 percent when China recorded new yuan loans of 9.5 trillion yuan. China's total new yuan lending slowed to 7.95 trillion yuan in 2010.
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