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Bloomberg
Industrial & Commercial Bank of China Ltd., the world’s largest lender by assets, reported the first decline in its bad-loan ratio since 2012 in the second quarter, while eking out 1 percent profit growth.
ICBC’s non-performing loans fell 4 percent to 196.3 billion yuan ($29.4 billion) at the end of June from three months earlier, according an earnings statement filed to Hong Kong’s stock exchange Tuesday. The bank’s bad-loan ratio fell to 1.55 percent from 1.66 percent.
Analysts and investors are focused on the risks to China’s banks and the nation’s economy from a rapid build-up of corporate debt and by bad loans among so-called “zombie†state-owned enterprises. Lenders have stepped up sales and write-offs of nonperforming loans and put more money into low-risk mortgage lending to limit credit risks.
The other of China’s big state banks to report Tuesday — Bank of China Ltd. — posted a higher-than-forecast 3.4 percent increase in second-quarter profit from a year earlier.
ICBC’s net income rose to 75.45 billion yuan, matching the median estimate of five analysts in a Bloomberg survey. Bank of China’s profit was 46.4 billion yuan, exceeding the median 45.1 billion-yuan estimate of six analysts in a Bloomberg survey.
The rest of the nation’s big-five state lenders last week posted meager profit gains for the second quarter. They were:
China Construction Bank Corp.: 0.9 percent Agricultural Bank of China Ltd.: 0.5 percent Bank of Communications Co.: 1.3 percent.