Honk Kong lender Bank of East Asia has beaten analyst forecasts in its financial declarations for 2005. Meanwhile the financial services outfit is looking to the bourgeoning Chinese mainland market for future gains.
Thanks to gains from exceptional items, Bank of East Asia posted an impressive 17% increase in net profit for 2005. The result, which lifted net profit to HKD2.75 billion, exceeded analyst expectations by as much as HKD400 million.
The bank said that net interest income increased by 4% to HKD3.76 billion, while total non-interest income improved by 16.5% to HKD2.19 billion. Meanwhile, exceptional income exceeded expectation thanks to the HKD365 million garnered from the sale of fixed assets, and revaluation gains of HKD234 million on investment properties, the AFX news agency said.
However, the positive bottom line figure did mask a disappointing trend in efficiencies as operating expense increased by 8% and cost-to-income ratio fell slightly.
Looking forward, Bank of East Asia chairman David Li has revealed further development in mainland China is on the cards. With the Chinese finance industry poised to take off, Bank of East Asia plans to convert all sub-branch locations into full branches by the end of the year. The bank also intends to open two further branches in New York.