The Bank of East Asia (23) H1 2024 earnings summary

Executive summary

• Profit attributable to owners for H1 2024 was HK$2,111 million, down 19.9% year-over-year, with basic EPS at HK$0.69 and annualised ROE at 3.7%.

• Pre-provision operating profit remained stable at HK$5,671 million, and net interest income rose 2.3% to HK$8,228 million, with NIM up to 2.10%.

• Net fee and commission income fell 2.2% to HK$1,418 million, while non-interest income increased 1.1% to HK$2,256 million.

• Operating expenses increased 4.9% to HK$4,813 million, raising the cost-to-income ratio to 45.9%.

• Impairment losses on financial instruments rose to HK$2,881 million, mainly due to Mainland commercial real estate exposure.

Financial highlights

• Total assets grew 1.7% to HK$875,217 million as of June 2024.

• Gross advances to customers increased 0.6% to HK$535,310 million; total customer deposits rose 0.2% to HK$630,109 million.

• Loan-to-deposit ratio was 82.0%, and impaired loan ratio improved to 2.62% from 2.69% at end-2023.

• Total equity attributable to owners rose 1.1% to HK$99,027 million.

• Interim dividend declared at HK$0.31 per share, down from HK$0.36 per share in 2023.

Outlook and guidance

• Global and regional economic growth is expected to remain gradual, with Hong Kong GDP forecasted at 2.5–3.5% and Mainland China targeting 5.0% for 2024.

• The group will focus on asset quality, diversified sustainable income, and digital transformation amid persistent uncertainties.

• New growth drivers identified in cross-boundary wealth management, digital banking, transaction banking, and SME segments.