Bank of East Asia touts commitment to SMEs as it reports 20% first-half profit slump
- The family-owned Hong Kong lender says it will continue to conduct SME business, amid concerns that many such firms face liquidity strain
Bank of East Asia (BEA), Hong Kong’s largest family-owned lender, has pledged continuing dedication to the city’s small and medium-sized enterprises (SMEs) amid concerns that many such companies are struggling with cash-flow issues.
The bank, which focuses primarily on Hong Kong and mainland China, said it approved HK$2.6 billion (US$333.6 million) in SME loans via around 80 transactions in the first six months of this year.
“Being a local bank, we are fully committed to supporting the local economy as well as the local SMEs,” BEA’s co-CEO Adrian Li said in a media briefing on the bank’s interim results on Thursday. “So far, we have not seen material credit deterioration, and our non-performing loan [NPL] ratio is not significant.”
BEA’s profit slumped 20 per cent year on year to HK$2.11 billion in the six months through June amid the downturn in Hong Kong and mainland China’s real estate sectors and global economic uncertainties.
The bank will continue to conduct SME business, which will be boosted by the government’s supporting measures and a favourable operating environment induced by Hong Kong’s integration with the Greater Bay Area and the coming interest-rate cut, Li said.
The segment’s customer base and lending remain significant to BEA, which currently allocates about 15 per cent of its loan balance in Hong Kong to SME customers. This is a slight drop from last year because some government guarantee programmes are expiring, Li said. The SME customer base has increased by 4.1 per cent year on year, he added.
