BoC expected to hit promised profit
BoC Hong Kong (Holdings) is unlikely to disappoint the market in its first set of annual results as a listed entity on Thursday.
Bank of China's Hong Kong flagship promised investors a HK$6.3 billion profit when it issued shares last summer, saying it would do whatever it took to make or beat that forecast. But analysts warn that worries about the quality of its corporate loan portfolio and exposure to the property market still cloud its future.
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According to the consensus estimate from Thomson First Call, BoC Hong Kong is expected to report net profits of HK$6.52 billion for last year from HK$2.77 billion the year before, thanks to a sharp drop in bad-debt charges and the lack of one-off charges associated with the bank's restructuring.......
"All eyes will be on the bad-debt side," said Simon Ho, regional banking analyst at Macquarie Equities (Asia). "I don't expect the market to walk away [from the results] thinking the worst is over and things are definitely improving from here. There is still a heavy flow of NPLs [non-performing loans] coming on to the books - it's just the legacy of the portfolio."
What did I say then?
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