Three of China’s largest lenders on Friday booked a jump in fourth-quarter net profit of well over 40%, the first green shoots since the global COVID pandemic battered borrowers last year, reported Reuters.
During the first three quarters of 2020, Chinese lenders made hefty loan-loss provisions as Beijing urged the sector to step up lending to pandemic-hit sectors, but many have begun to see improvements in earnings in tandem with an economic recovery and are expected to continue to do so throughout the year, said Reuters.
“Banks’ average net interest margin is unlikely to narrow further from the 2020 level of 2.1% because of the central bank’s gradual return to a neutral monetary policy stance,” said Moody’s in a March China Banking outlook.
Industrial and Commercial Bank of China (ICBC) and Bank of Communications booked a jump in fourth-quarter net profit on Friday of well over 40%. Meanwhile, China Construction Bank Corp logged a 58% surge in fourth-quarter net profit.