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Huaxia Bank targets further growth in profit

(XFN-Asia)
Updated: 2007-03-27 16:28

Huaxia Bank Co Ltd, in which Deutsche Bank AG and European private bank Sal Oppenheim together own a 13.98 percent stake, said it is targeting operating profit of 2.95 billion yuan (US$381 million) this year, up from 2.41 billion yuan in 2006, supported by increased lending.

In a statement submitted to the Shanghai Stock Exchange, the bank said it expects its outstanding loans to stand at 310 billion yuan at the end of this year. That would be 19 percent higher than the end-2006 level of 259.77 billion yuan.

Huaxia said its outstanding deposits are projected to reach 430 billion yuan by year-end, up 16 percent from 371.3 billion at the end of last year.

The lender said it will keep its nonperforming loan ratio at 2.7 percent this year compared to 2.73 percent last year.

Earlier this month, Huaxia Bank reported its 2006 net profit rose 13.9 percent to 1.457 billion yuan as its core business revenue jumped 31.2 percent to 18.083 billion, under Chinese accounting standards.

The bank said it will try to complete the issuance of 4.5 billion yuan worth of hybrid bonds within the first half of this year, and added it will issue additional A-shares at an "appropriate" time to boost its core capital adequacy ratio.

The bank also said it will speed up cooperation with Deutsche Bank in the credit card business and will launch its credit card operations this year. Huaxia Bank is the only listed Chinese commercial bank that has no credit card business.

The bank said it is also considering to go into asset securitization and investment banking.