CCB profit jumps on higher lending and fee income
last year, 6 percent less than the amount offered in 2010. That helped boost weighted-average lending rates to 8.01 percent in December, up 1.82 percentage points from the beginning of the year, according to the central bank.
CCB made 827 billion yuan of new loans in 2011, taking the total to 6.5 trillion yuan. Its net interest margin widened to 2.7 percent from 2.5 percent a year earlier, according to the company’s statement on Sunday.
China relaxed lenders’ reserve requirements twice since the start of December and scrapped bill sales this year to ease a cash crunch that was stifling growth in the world’s second-biggest economy.
Gross domestic product expanded 8.9 percent in the fourth quarter, or at the slowest pace in more than two years.
CCB’S non-performing loans rose 6.3 billion yuan in the fourth quarter to 70.9 billion yuan on Dec 31, accounting for 1.09 percent of the portfolio. The bank set aside 15 billion yuan against soured debt during the period, 10 percent less than a year earlier.
“For years there are lots of international worries on what’s going on in China, yet China comes out fine,” said Frank Newman, former chairman of Shenzhen Development Bank Co on March 23. “The government does not want to have a big banking problem this year or next year, and there are a lot of things they can do in terms of extending loans, rearranging government financing.”
China is trying to spur credit to smaller companies while limiting home loans that could create a property bubble. In a speech in Beijing on March 5, Premier Wen Jiabao said the government will “strictly implement” restrictions.