Earnings were boosted by net fee and commission income growth.
Bank of East Asia opened the financial year on strong financial footing after profits rose 25.9% YoY to $3.99b in the first half of 2018, according to its financial statement.
The strong earnings performance was boosted by increases in net fee and commission income which rose 11.8% YoY to $1,362m. Commission income from securities and brokerage, retail banking services, asset management, investment product and credit card businesses also grew.
Both net interest and non-interest income also booked positive performances after rising 8.9% and 24.6% respectively.
The bank’s bad loan ratio also improved from 1.09% as of end-December to 0.94% by June with the impaired loan ratio for Hong Kong operations falling from 0.91% to 0.79%, whilst that for Mainland China operations also dipped from 1.79% to 1.59%.
On the other hand, BEA’s operating expenses rose 9.1% on the back of higher staff costs and digital investments to its retail banking arm. Nonetheless, the bank was able to post improving cost-to-income ratios of 49.1% in H1 2018 compared to 50.7% in 2017.
“In Hong Kong, we are re-doubling our commitment to digital banking. All branches in Hong Kong are now equipped with state-of-the-art digital access. The platform is attracting new customers to the Bank, and generating many positive reviews,” David K.P. Li, chairman and chief executive of BEA said in a statement.
The bank has announced an interim dividend of 51 cents per share for the period from January to June.
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