Today, Industrial Bank Co., Ltd. (IB) announced its third quarter performance in 2015. The Company actively adapted to changes in the outside macroeconomic environment and market situation, continued sticking to the basic work line of “maintaining steady development, guaranteeing security and boosting transformation”, kept pushing forward structural adjustment, transformation and upgrading, and maintained steady and sound development in various businesses, with the general business performance meeting the anticipation.
Steady development and financial performance were maintained in various businesses. By the end of the third quarter, the total assets of the Company hit RMB 5,289.398 billion, up by 20.04% over the beginning of this year. The equity belonging to the shareholders of the parent company reached RMB 302.424 billion, up by 17.25% over the beginning of this year, and the total operating income registered hit RMB 112.354 billion, a YoY growth of 23.67%. The net profits attributable to the shareholders of the parent company hit RMB 41.221 billion, up by 7.62% YoY, and the profits before provision amounted to RMB 79.700 billion, up by 23.40% YoY. The return on total assets and the return on equity were 0.86% and 15.75% respectively, remaining at the first-rank level among listed banks in China. The business and overhead expenses increased 17.31% YoY, 6.36% below the increase of the operating income, and the cost/income ratio was 20.67%, down by 0.98% YoY.
In adaptation to changes in environment, active adjustment was made to business structure and development pace. In the third quarter, the Company slowed down the asset growth speed on its own initiative to control the growth of risk assets strictly, with the total assets increasing 3.19% and the capital sufficiency going up 0.17% on a quarterly basis. In the meantime, the Company, orienting at the return on weighted risk assets, grasped opportunities to increase its exposure to quality assets of lower risk weight in an active manner, and the investment assets increased by RMB 300.674 billion over the beginning of this quarter. In the aspect of liabilities, the Company continued extending of multi-channel liabilities actively and maintained steady low-cost customer deposits. The offering of inter-bank negotiable certificates maintained a leading position in the market, with the balance increasing RMB 154.1 billion over the beginning of this year. Against the downturn of capital market, the Company grasped the opportunity to attract deposits of non-deposit financial institutions, witnessing significant increasing in the balance over the beginning of this year. Based on the improvement of asset-liability structure, the net interest margin of the Company in the third quarter increased by 11 BPs on a quarterly basis, driving the operating income to go up 5.37%. On condition of sufficient provision and accrual, the net profits attributable to the shareholders of the parent company realized in the third quarter hit RMB 13.477 billion, up by 4.04% on a quarterly basis.
The general asset quality was kept stable with intensified risk control. Under the influence of factors including slowdown of economic growth, adjustment of industrial structure, private lending, and guarantee chain, the credit risks in some regions and industries increased to some extent and so did the number of enterprises encountering problems like drop in repayment capability, tightened capital and disrupted capital chain, thus leading to increased risk cost to the Company. In confrontation with the relatively severe and complicated situation, the Company exerted itself to take various measures to intensify risk control, maintaining stable asset quality in general. By the end of the third quarter, the balance of the non-performing loans of the Company reached RMB 27.487 billion, up by RMB 9.943 billion over the beginning of this year, and the non-performing loan ratio hit 1.57%, up by 0.47%. The Company accrued risk provision strictly. The asset impairment reserve accrued in the first three quarters totaled RMB 27.576 billion, up by 82.38% on a YoY basis. At the end of the third quarter, the LLR/loan ratio reached 2.97% and the provision coverage hit 189.64%, with a generally sufficient provision coverage.
In the next stage, the Company will continue furthering reform and improving mechanism, and adhere to development path characterized by “light capital, light assets, improved structure and high efficiency” unswervingly. In addition, based on new changes in and instances of both internal and external situations, it will push corresponding adjustment to business strategies actively at a proper time so as to improve the internal power for business transformation and development. Meanwhile, the Company will also provide vigorous guarantee for deepening the reform of risk management system and improving the risk management policies and tools, so as to safeguard the steady business development of the entire bank.