After 2016 squeeze, some top China banks set for stronger growth Reuters – WBNews

BEIJING Improving asset quality and rising loan demand could see some of China’s biggest listed banks bolster their profit growth this year, bankers signalled this week, even as interest margins remain under pressure and more bad loans are written off. “The trend is promising,” Yi Huiman, Chairman of Industrial and Commercial Bank of China Ltd (ICBC), the world’s biggest lender, said on Thursday, citing the impact of broad economic recovery. Pricing for loans is stabilising and may even pick up as the cost of funds rises this year, Yi said. Net profit at four of China’s top five banks grew by less than two percent for last year, and at Bank of China (BoC) , it fell 3.67 percent – its worst performance in more than a decade. The banks’ results showed deteriorating credit quality and high corporate debt leverage continued to be a primary challenge for the industry, as the world’s second-largest economy grew at its slowest pace in a quarter of a century. Difficulties were most evident at BoC where Pan Yuehan, chief risk officer, said on Friday that asset quality “still faced a great challenge” this year. Bad loans written off and transferred out by the top five banks rose by 16 percent last year to 309.6 billion yuan ($44.95 billion). Those banks also include China Construction Bank Corp (CCB), Agricultural Bank of China Ltd (AgBank) and Bank of Communications Co Ltd (BoCom). At the same time, profitability in traditional lending fell as net interest margins (NIMs)…more detail