Bank of China Ltd.’s profit fell in the third quarter for the first time since the global financial crisis as the Chinese economy faltered.
Net income slipped 1.5 percent from a year earlier to 40.8 billion yuan ($6.4 billion), the company told Hong Kong’s stock exchange on Thursday. That was less than the 42 billion yuan average estimate of three analysts.
Bank of China’s profit decline, the first since 2009, followed a 1.2 percent gain in the previous three months.
Bank of China net interest margin fell for the sixth consecutive quarter to 2.14 from 2.18 at the end of June.
The six rate cuts are expected to narrow 15 listed banks’ NIM by 16.3 basis points this year and 35.1 basis points next year, a CICC research note said.
The lender was the second of China’s big-four banks to report as weakness in the economy caps demand for credit and leads to more soured loans. Agricultural Bank of China Ltd. last week posted a 1 percent profit gain in the third quarter from a year earlier.
BoC’s impairment losses on assets rose to 44.89 billion yuan for the first nine months of this year, an increase of 14.88 percent compared with the year-earlier period.
The bank, which earns more overseas than its top four rivals, raised the equivalent of $3.55 billion for Silk Road projects in June, in the first public bond issue to finance infrastructure along the trading route between Asia and Europe. ($1 = 6.3552 Chinese yuan renminbi)