LINE

Text:AAAPrint
Economy

SPD Bank's slowing profits may herald grim year ahead for banking industry

1
2017-01-05 10:28China Daily Editor: Feng Shuang ECNS App Download

China's banking industry received a worrying new year wake-up call on Tuesday, with the first preliminary earnings report for the 2016 fiscal year from a commercial lender showing a significant slowdown in profit growth.

Shanghai Pudong Development Bank Co Ltd, a joint-stock commercial lender headquartered in Shanghai, announced on Tuesday a 4.93 percent growth in net profit attributable to equity holders in 2016, a record low since it was listed on the Shanghai Stock Exchange in 1999.

The net profit was 12.42 billion yuan ($1.79 billion) in the fourth quarter of 2016, a decline of 7.6 percent year-on-year.

Its negative profit growth in the fourth quarter sent out a warning signal to the banking industry.

During the first nine months of last year, the four largest State-owned banks, including Bank of China Ltd and China Construction Bank Corp, posted modest growth in net profit, ranging from 0.46 to 2.48 percent.

Their total net profit amounted to 705.61 billion yuan during the same period-an increase of just 1.08 percent year-on-year. This means they are likely to post a negative profit growth for the year.

"The profit growth of most Chinese banks fell to a single digit and will even turn negative, which truly reflects the current state of the real economy," said Zeng Gang, director of banking research at the Institute of Finance and Banking of the Chinese Academy of Social Sciences.

The restructuring of the real economy made it difficult for banks to continue relying on credit for income growth, he said.

The net interest incomes of the four largest banks totaled 1.2 trillion yuan in the first three quarters of 2016, down 7.77 percent year-on-year.

  

Related news

MorePhoto

Most popular in 24h

MoreTop news

MoreVideo

News
Politics
Business
Society
Culture
Military
Sci-tech
Entertainment
Sports
Odd
Features
Biz
Economy
Travel
Travel News
Travel Types
Events
Food
Hotel
Bar & Club
Architecture
Gallery
Photo
CNS Photo
Video
Video
Learning Chinese
Learn About China
Social Chinese
Business Chinese
Buzz Words
Bilingual
Resources
ECNS Wire
Special Coverage
Infographics
Voices
LINE
Back to top Links | About Us | Jobs | Contact Us | Privacy Policy
Copyright ©1999-2018 Chinanews.com. All rights reserved.
Reproduction in whole or in part without permission is prohibited.