Strong interest margins boost AgBank profit

    AGRICULTURAL Bank of China Ltd. (AgBank), the country’s third-largest listed lender, said Saturday that its first-quarter net profits rose 13.6 percent, beating estimates, due to strong growth in its net interest margins.

    Interest margins are expected to fall in the long run for Chinese banks as China liberalizes interest rates that guarantee a fat spread between the rate banks pay depositors, and the rate they lend at. AgBank’s rise in net interest margins in the first quarter to 2.96 percent from 2.79 percent at the end of last year likely reflects tight credit conditions at that time, where banks had additional bargaining power with borrowers. Net profit for the quarter rose to 53.4 billion yuan (US$8.55 billion) from 47.0 billion yuan in the same 2013 period, the bank said in its unaudited financial statement.

    Lower investment gains dent China Life profit

    CHINA Life Insurance Co., the country’s biggest insurer by market value, said Saturday profit fell 28 percent in the first quarter from a year earlier as investment returns dropped.

    Net income fell to 7.23 billion yuan (US$1.2 billion), or 0.26 yuan a share, from 10.1 billion yuan, or 0.36 yuan, a year earlier, the Beijing-based company said in a statement to the Shanghai Stock Exchange. China Life’s gross premiums rose 18 percent in the first quarter from a year earlier, as the company boosted sales of regular-premium products to improve margins. Investment income fell to 24.2 billion yuan in the first quarter from 26.1 billion yuan a year ago.

    BYD’s earnings tumble on sluggish sales

    SHENZHEN-BASED carmaker BYD Co. posted an 89 percent drop in first-quarter earnings Friday, hit by falling vehicle sales.

    BYD and other domestic carmakers, including Geely Automobile Holdings and Chery Automobile Co., are losing market share to foreign rivals such as Volkswagen, General Motors and Ford. BYD’s net income during the first three months of the year fell to 11.97 million yuan (US$1.92 million), against 112 million yuan a year earlier, it said in an exchange filing.

    Bank of China net profit rises 14%

    BANK of China, the country’s fourth-largest lender by market value, Friday posted a higher-than-expected 14 percent rise in first-quarter net profit as net interest margins widened and its capital ratio improved.

    The bank’s net profit rose to 45.4 billion yuan (US$7.28 billion) in the first quarter, up from 39.8 billion yuan a year ago.