AgBank net rises 3pc to 133b yuan

The Agricultural Bank of China (1288) saw its half-year net profit increase by 3.48 percent year-on-year to 133.2 billion yuan (HK$143.3 billion) but decided not to distribute an interim dividend.

The bank's total non-performing loans as of June 30 stood at 294.4 billion yuan, up 23.3 billion yuan from the end of last year.

But its non-performing loan ratio decreased by 0.02 to 1.35 percent from the end of last year.

First-half operating income reached 365.8 billion yuan, up 0.7 percent compared to last year. But net interest income declined by 3.25 percent to 290.4 billion yuan.

The net interest margin was 1.66 percent, while the net interest spread was 1.49 percent. Both decreased by 36 and 37 basis points respectively year-on-year.

Bank president Fu Wanjun said that China may cut interest rates for mortgages and there will continue to be downward pressure on the industry's net interest spread during the latter half of the year.

Bloomberg had earlier reported that China may announce that its big state-owned banks will cut rates on the majority of the nation's 38.6 trillion yuan of existing mortgages, citing people familiar with the matter.

The reductions will only affect loans on first-time home buyers, according to the people.

In other news, Bank of Communications (3328) plans to hold a meeting today to initiate discussions on adjusting interest rates for existing individual housing loans.

In 2022, more than 80 percent of new home loans were for first-time buyers, according to the housing ministry.