China Construction Bank Corporation (CCB) announced its 2005 results report which fully disclosed its operation performance, financial results and asset quality for the year of 2005 on April 6.

In 2005, net interest income, net fee and commission income of CCB maintained a continuing growth, and profit before tax surged by 8.1% from RMB51,199 million in 2004 to RMB55,364 million. Net profit decreased by 4.0% to RMB47,096 million, which resulted from an increase in the income tax following the expiry on 30 June 2005 of the Bank’s tax exempt status granted as part of its restructuring. Excluding the tax effect, net profit for 2005 actually increased by RMB5,681 million, or 16.9% compared to that of 2004 on the same basis. Earnings per share were RMB0.24 (2004: RMB0.26). The Board of Directors recommends the payment of a final dividend of RMB0.015 per share.

The year of 2005 saw a continued improvement in all operation indicators of CCB. Return on average assets and return on average equity were 1.11% and 21.59% respectively. Cost to income ratio also remained at a good level, down further from 46.87% in 2004 to 45.13%. Loan quality continued to be enhanced, with the decrease of both the non-performing loan ratio from 3.92% at the end of 2004 to 3.84% at the end of 2005, and the ratio of special mention loans to total loans from 16.7% in 2004 to 11.8% in 2005.

CCB’s capital adequacy ratio as at 31 December 2005 was 13.57%, an increase of 2.28 percentage points compared with a year earlier, largely due to net proceeds of RMB72.6 billion from the IPO and the enhanced profitability and ability of asset management.

As of 31 December 2005, CCB’s total assets amounted to RMB 4,585,742 million, an increase of 17.3% or RMB675,822 million compared with 2004. And its total liabilities reached 4,298,065 million, an increase of 15.7% or RMB 583,696 million over the previous year.

In 2005, CCB’s lending business remained a continuing growth with the loans balance increasing by 10.4% to RMB2,458,400 million. The increase of loan portfolio was mainly distributed in infrastructure industries such as transportation and power, and industries with quality assets such as petrochemical. China’s competent authorities carried out some macro-adjustment policies over the real estate market, yet CCB made the residential mortgage loans balance increase by 12.5%, based on its good brand awareness, quality customer services and innovative products. CCB is also committed to diversifying its fee and commission based services and has expanded the range of services over the past year. Thus, the net fee and commission income increased by 30.7% to RMB8,455 million, largely due to the increase in incomes of bank card fee, remittance, settlement, account management fee, and agency fee.

CCB successfully introduced Bank of America Corporation (BOA) and Asia Financial Holdings (Pte) Ltd as strategic investors and developed partnership in various core areas in 2005.  Recently, CCB and BOA has jointly launched ATM cash withdrawal services for their high net worth customers since April 1st, 2006. Cardholders of CCB’s “Happy Investor” Card can access BOA ATMs with charge free.

CCB’s Chairman Mr. Guo Shuqing believes, “With our solid business strategies, strong asset quality, broad customer base, improving management capabilities and close partnership with strategic investors, CCB is well placed to take advantages of the opportunities ahead to provide the highest quality services for our customers, maximize values for our shareholders and provide the best career development opportunities for our employees.”