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Bank of China says first-half profits up 28 percent on surging revenues

BEIJING - Bank of China Ltd., China’s No. 2 commercial bank, said Tuesday its first-half profits jumped 28 percent to 19.5 billion yuan (US$2.4 billion; euro1.9 billion) on surging revenues.

The bank beat expectations by analysts surveyed by Dow Jones Newswires, who on average had forecast earnings of 17.8 billion yuan (US$2.2 billion; euro1.7 billion).

The bank said first-half revenues jumped 29 percent to 100.1 billion yuan (US$12.5 billion; euro9.8 billion). First-half earnings last year were 15.2 billion yuan (US$1.9 billion; euro1.5 billion) on revenues of 77.6 billion yuan (US$9.7 billion; euro7.6 billion).

The bank said its total assets stood at 5.2 trillion yuan (US$650 billion; euro510 billion), up 10.4 percent over the end of 2005.

China’s banks have seen revenues soar amid double-digit growth in lending.

They are racing to modernize their operations as Beijing prepares to meet a Dec. 11 deadline for opening their market to foreign competitors under World Trade Organization commitments.

Chinese elite state-owned banks have raised billions of dollars with share offerings abroad to replenish their capital after massive write-offs of unpaid loans to state companies.

Bank of China raised US$11.2 billion in May with an initial public offering in Hong Kong and another US$2.5 billion in July with a sale of shares on the Shanghai Stock Exchange.