CHINA Construction Bank, the world’s second biggest lender by market value, reported a 25 per cent rise in 2011 net profit, missing expectations as lending curbs on the real estate sector hit earnings.
Net profit in 2011 rose to 169.3bn yuan (£16.9bn) from 135bn yuan the year before, according to a filing to the Hong Kong bourse. This was below expectations for 170.1bn yuan, according to a survey of 25 analysts.
CCB, which has Singapore state investor Temasek as a stakeholder, said loan-loss provisions rose by a fifth last year, higher than its 14.5 per cent annual loan growth.
The higher bad loan costs highlight growing concern that non-performing loans at China’s banks are likely to increase as growth in the economy slows. Premier Wen Jiabao this month forecast sub-eight per cent GDP growth for the first time in eight years.
“In 2012, the global economic environment is expected to become more severe and China’s economic development faces numerous challenges,” CCB said in a statement yesterday.
City A.M. Reporter