Banking News
- BOC profit surges more than 50%
Date: 20-Mar-2007 Sources: (Shenzhen Daily)
BANK of China Ltd. (BOC), the nation's second-largest, said yesterday 2006 profit surged more than 50 percent, benefiting from a tax credit and an expanding economy.
The bank, which paid 4.6 billion yuan (US$595 million) less in tax last year after being granted pretax deductions for staff costs, didn't provide a profit figure in its statement. Net income in 2005 was 27.5 billion yuan, based on domestic accounting standards, it said.
China's trade surplus surged to a record of US$177.5 billion in 2006, fueling economic growth of 10.7 percent and prompting the government to seek to cool lending. Growing demand for loans and trade finance services buoyed Bank of China, which extended more than a third of China's foreign-currency loans.
Bank of China has the highest exposure to Hong Kong, Macao and other overseas markets which benefit from stronger China trade inflows and offshore investments, Tracy Yu, a Hong Kong-based analyst at Citigroup Inc. wrote in a report this month.
Bank of China has more than 600 overseas branches, about five times more than larger rival Industrial & Commercial Bank of China Ltd. It makes more than a third of its profit from outside the mainland, mainly in Hong Kong and Macao.
The bank agreed to buy out Singapore Aircraft Leasing Enterprise for US$965 million in December, the first major acquisition by a mainland bank. It also owns an insurance unit in Hong Kong and an investment bank on the mainland.
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