Estimated more than 29% profit increase of both banks seen to improve confidence in China’s lenders.
Industrial & Commercial Bank of China Ltd. and Bank of China Ltd. may report profit growth of at least 15 percent on Thursday, helping bolster confidence in the country’s banks amid tighter government scrutiny of lending.
ICBC, the world’s largest bank by market value, may post a 29 percent increase in second-quarter income, according to the average estimate among 10 analysts surveyed by Bloomberg. Bank of China is expected to post profit growth of 15 percent for the period. Both lenders are based in Beijing.
Chinese bank shares have slipped this year as the industry regulator clamped down on loans to local-government financing vehicles and property speculators, and ordered them to move off- balance-sheet debts back onto their books. Construction Bank Corp. on Aug. 22 said those measures won’t have any meaningful impact on its earnings or finances.
“The market is trading banks down this year because of fears of local government loans, off-balance-sheet loans and property loans,” said Jim Antos, a Hong Kong-based analyst at Mizuho Securities Asia Ltd. Based on the outlook for banks’ earnings, “this is a tremendous story,” he said.
View the full story in Bloomberg.
Do you know more about this story? Contact us anonymously through this link.