China Merchants Bank (3968) reported a 7.8 percent rise in net profit to 38.8 billion yuan (HK$44 billion) in the first quarter from a year earlier.
Net interest income edged up 1.74 percent to 55.4 billion yuan in the first three months but the net interest margin was down 0.22 percentage points to 2.29 percent during the period.
Non-interest income fell by 6.2 percent to 35.2 billion yuan, mainly due to a weakening in risk appetite and investment willingness of customers, the bank said.
Among them, net fee and commission income slumped 12.6 percent to 25.1 billion yuan.
Its non-performing loan ratio stood at 0.95 percent as of March, slightly down by 0.01 percentage points as compared with the end of the previous year.
The bank's non-performing loan ratio in the real estate sector, however, grew 0.56 percentage points to 4.55 percent by the end of the first quarter, mainly due to the further exposure to risks from certain high-debt real estate customers, it said.
This came as official data showed that the overall non-performing loans in China's banking sector rose by more than 100 billion yuan in the first quarter while the non-performing loan ratio fell during the period.
Outstanding non-performing loans in China grew by 125.9 billion yuan to stand at 3.9 trillion yuan as of March, according to a statement by the China Banking and Insurance Regulatory Commission.
But the non-performing loan ratio dropped 0.09 percentage points to 1.68 percent by end-March.
