Lower Impairments Push Profits Up for Bank of East Asia
A significant improvement from impairment losses drove profits 11 percent higher for Bank of East Asia in 2020.
The banking group posted an annual profit of 3.61 billion Hong Kong dollars (US$466 million) for 2020, according to a statement, compared with a profit of 3.26 billion Hong Kong dollars in 2019.
This was driven in no small part by a sharp fall in net charge for impairment losses to 4.67 billion Hong Kong dollars, down from 7.25 billion Hong Kong dollars last year.
«We started the year in a strong position, having made the difficult decision in 2019 to write down a series of legacy bad loans,» said Bank of East Asia’s executive chairman David Li Kwok-po. «At the same time, we accelerated our commitment to digital transformation, and shifted resources to fee-based services.»
Mainland Momentum
The 102-year old lender is banking on growth in China where it registered a 1.05 billion Hong Kong dollar pre-tax loss in 2020, up from a 4.76 billion Hong Kong dollar loss last year. The mainland market was also the main driver of reduced impairment losses for the bank.
The Greater Bay Area will key area of focus in the market where the bank appointed ex-retail lending head Christine Lo to lead the office.
In Hong Kong, the bank’s pre-tax profits fell to 3.41 billion Hong Kong dollars, down from 5.85 billion Hong Kong dollars last year.
