Agricultural Bank operating profit rises 39pc to 54b yuan

Operating profit at Agricultural Bank of China, the only one of the Big Four mainland banks yet to be restructured, rose 39 per cent to 54.3 billion yuan (HK$62.21 billion) in the first half of the year, the bank said yesterday.

Agricultural Bank saw its bad-loan ratio decline by 1.61 percentage points as the value of non-performing loans fell by 10 billion yuan, a further sign that the country's fourth-biggest lender is inching closer towards its planned stock-market listing.

But analysts said the first-half figures were disappointing after earlier reports put first-quarter profit up 71 per cent at 34 billion yuan. Earnings growth was also significantly down on last year, which saw operating profit soar 65.3 per cent to 96.1 billion yuan.

By comparison, Industrial and Commercial Bank of China's first-half profit expanded by more than 50per cent, while China Minsheng Banking Corp, Shanghai Pudong Development Bank and China Citic Bank all released preliminary earnings growth estimates in excess of 100per cent.

Agricultural Bank's decline in bad-loan ratio would reduce it to around 21.9 per cent according to previously released data - still by far the highest proportion of any mainland bank.

The ratio of bad loans at the mainland's big commercial banks dropped by 0.62 percentage point from the start of the year, to 6.1 per cent at the end of June, with total non-performing loans falling by 24.71 billion yuan to 1.18 trillion yuan, the China Banking Regulatory Commission said yesterday.

Mainland banks' total assets stood at 57.7 trillion yuan at the end of June, up 19 per cent on the same period last year. Liabilities totalled 54.4 trillion yuan, up 18.4 per cent, the regulator said.