Agricultural Bank’s first-half profit rises by 5.4 per cent as China’s third-largest lender defies economic headwinds
- Net income rose to 128.9 billion yuan while revenue rose by 5.4 per cent in the six months ended June 30
- The bank’s non-performing loan ratio fell to 1.41 per cent from 1.43 per cent from the beginning of the year
Net income rose to 128.9 billion yuan (US$18.6 billion) in the six months ended June 30, from 122.3 billion yuan a year earlier, the Beijing-based bank said in an exchange filing on Monday. The bank’s non-performing loan ratio fell to 1.41 per cent from 1.43 per cent from the beginning of the year.
China’s US$52 trillion banking industry is being closely scrutinised by investors as the country’s rolling Covid-19 lockdowns and a deepening property crisis is slowing economic growth. Banks have been told to boost credit to the embattled developers and smaller businesses even as lending margins shrink and bad loans piled up.
Chinese banks’ exposure to the property sector tops that of any other industry, making them vulnerable to the woes that have already roiled capital markets and burned the nation’s middle class.
In a worst-case scenario, S&P Global Ratings estimated that 2.4 trillion yuan, or 6.4 per cent of mortgages, are at risk amid a mortgage boycott across more than 90 cities as millions of homes have been left unfinished.
