RETAIL BANKING | Tony Chua, China

Listed banks in China eye 30% profit growth in 3rd quarter

Analysts believe large banks’ interest margin to peak in the second quarter as their assets quality remains stable.

China's listed banks are expected to post a 30-percent year-on-year increase in net profits for the third quarter due to the increased spread of intermediary services, according to analysts.

"Large banks saw the interest margin reach its peak in the second quarter, while small- and medium-size banks expected widened spreads," said She Minhua, an analyst at Zhong De Securities.

The net profits of listed banks will surge more than 31 percent to 696.7 billion yuan (109.2 billion U.S. dollars) in the first three quarters, according to a report by Sinolink Securities.

The report said net interest earnings by listed banks will rise 26 percent year-on-year in the first three quarters, with interest-earning assets increasing 17 percent from the same period of last year.

"Banks' assets quality remains generally stable," said Xu Wenbing, an analyst from the Bank of Communications, adding that small enterprises' credit risks have not transferred to the nation's banking system.

Previous media reports stated that small- and medium-sized enterprises are facing an unprecedented crisis this year as they struggle to survive a liquidity crunch amid the country's tightened macroeconomic control policies. However, a multi-department investigation has shown that the crisis has largely been kept under control.

View the full story in Xinhua.

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