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Bank shores up its position

THE Shanghai Pudong Development Bank aims to increase provision against non-performing loans and cut bad loans this year to ride out the economy slowdown, it announced today.

The bank has a healthy balance sheet with balanced growth on assets and debts and a curb on bad assets as priority on its 2009 agenda.

The bank yesterday held a conference on this year's agenda, summarizing its 2008 performance in 2008 and setting a plan for 2009.

The bank said deteriorating assets and profit slowdowns are the biggest challenges but says there are opportunities to buck the trend.

"The global financial crisis brings both challenges and opportunities," the bank said. "The banking industry faces a tough year ahead amid the economic downturn. On the other front, the central government's easing of monetary policy and proactive fiscal policy also gives the industry opportunities."

The bank's 2008 net profits jumped 127 percent to 12.5 billion yuan (US$1.83 billion) despite a tough and complex external environment, the bank said today in the emailed statement.

The bank's revenue increased 33 percent to 34.4 billion yuan, it said in an earlier preliminary statement to the Shanghai Stock Exchange.

The bank is scheduled to post its full 2008 annual report on February 28.

Analysts said the whole-year figures may be rosy but a sharp slowdown in the fourth quarter is unavoidable.

The People's Bank of China, the central bank, cut interest rates five times last year and squeezed banks' margins.

The banking industry is facing weakening assets amid the economy slowdown.

China's economy rose 9 percent last year with the fourth-quarter growth dropping to a seven-year low of 6.8 percent.


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