Chinese banks’ profits grew faster during the first half of 2018, but they still need to rein in risks in asset quality, PwC warns in a latest report.The report, covering the interim financial results of 15 A-share and H-share listed banks, found that their combined assets totaled 153.88 trillion yuan (US$22.46 trillion) as of the end of June, up 3.56 percent year on year but it slowed from the previous year’s 4.09 percent growth.Total net profit for the 15 listed banks was 824.942 billion yuan during the same period, up 6.39 percent from a year ago. The growth figure is faster than the 4.11 percent expansion posted in the first six months of 2017.“The expansion of China’s large commercial banks’ interest-generating assets, along with increasing loan yields, contributed to the growth of net interest income and drove profit growth,” said Jimmy Leung, PwC’s China financial services leader .For the first half, the non-performing loan ratios for the lenders have continued to fall. By end-June, their average NPL ratio was 1.53 percent, down 0.04 percentage points from the end of 2017. However, the overdue loan ratio rose by one basis point to 2.01 percent. This implies that uncertainty around asset quality still persists.
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