Bank of China 1Q net profit falls 14%

Bank of China said its first quarter net profit fell 14% year-on-year to US$2.7 billion due to declines in interest and fee-based income, the Wall Street Journal reported. The lender, the smallest of the mainland’s state-run banks, saw net interest income fall by 9.8% on a yearly basis to US$5.4 billion. Outstanding loans grew 16% during the first quarter, bringing the total to US$556.2 billion at the end of March, while the nonperforming loan ratio stood at 2.29%, down from 2.65% at the end of last year. The bank’s capital-adequacy ratio fell to 12.34% from 13.43% in the same time period. Bank of China booked an impairment charge of US$2.4 billion for potential subprime-related losses of US$4.6 billion, reducing the book value of its subprime portfolio to about US$2.2 billion at the end of March.