BOC Hong Kong (2388) H1 2024 earnings summary

Executive summary

• Attributable profit for the first half reached HK$20.0 billion, up 17.9% year-over-year, with ROE improving to 12.39%.

• Interim dividend per share declared at HK$0.57, an 8.2% increase, the highest interim DPS in a decade.

• Maintained market leadership in residential mortgage, syndicated loan, RMB bond underwriting, and cross-border business, with deposit market share at 15.7% and loan market share at 16.5%.

• Southeast Asian business saw robust growth, with deposits up 17.4%, loans up 8.6%, and net operating income up 30.8%.

• Net operating income before impairment allowances rose 14.6% year-over-year to HK$35,336 million.

Financial highlights

• After-tax profit for the first half grew 13.2% year-over-year to HK$20,463 million.

• Net interest income grew 15.3% year-over-year to HK$28.8 billion; adjusted NIM improved to 1.61%.

• Net fee and commission income increased 1.8% year-over-year, with strong growth in funds distribution, insurance, and currency exchange.

• Operating expenses rose 3.4% to HK$8.1 billion; cost-to-income ratio improved to 22.98%.

• Customer deposits rose 5.8% to HK$2.65 trillion, with total assets at HK$3,998 billion.

Outlook and guidance

• Focus for the second half includes sharpening risk management, maintaining solid profitability, and expanding diversified income sources.

• Expects global political and economic changes, persistent monetary policy uncertainties, and opportunities from Belt and Road and RCEP initiatives.

• Key priorities include developing capital-light products, promoting RMB internationalisation, and enhancing digital transformation.

• Management anticipates continued economic recovery in Hong Kong and the Chinese mainland, with US rate cuts and stable exports supporting growth.