Shenzhen Development Bank dips despite 700% profit rise forecast

16:38, January 27, 2010      

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Shenzhen Development Bank (SDB), one of China's largest city commercial banks, slipped 0.63 percent to close at 21.91 yuan (3.2 U.S. dollars) per share on Wednesday despite forecasting a 700-percent jump in annual net profits last year.

In a statement filed to the Shenzhen Stock Exchange, SDB said it expected last year's net profit to be over 5 billion yuan (733.1 million U.S. dollars), and earnings per share to be about 1.6 yuan.

The forecast has not yet been audited. The bank's profit in 2008 was 610 million yuan.

The profit rise was attributable to falling credit provision and rising interest income, said the bank.

Credit provision is a bank's funds to deal with bad loans, the higher the provision, the fewer funds the bank can claim as profit.

In 2009, deposits of the bank grew 26 percent year on year to 455 billion yuan, and loans grew 27 percent to 360 billion yuan, raising gross revenue by 4 percent year on year to 151 billion yuan, said the bank.

The SDB, based in South China's Guangdong Province, has a market value of 68 billion yuan. It was the first Chinese commercial bank listed on the Shenzhen Stock Exchange.

Other listed companies also filed their statements on their performance in 2009 to either Shanghai or Shenzhen stock market earlier in the day.

Source: Xinhua
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