"Performance" Bank of East Asia's annual net profit fell 24% to HKD 3.5 billion, and the interim dividend was reduced to 22 cents for the second time

Bank of East Asia (00023.HK) announced its annual results for the year ending last December, with operating income of HKD 21.019 billion, an increase of 0.2% year-on-year. Net profit was HKD 3.501 billion, a decrease of 24% year-on-year; earnings per share were HKD 1.22. The second interim dividend was HKD 0.22 per share, compared to HKD 0.38 for the same period last year. The total annual dividend was HKD 0.61, down from HKD 0.69 for the previous fiscal year.

The group stated that it continues to proactively and prudently make provisions for exposure to commercial real estate. Of this year's provisions, 77% are related to commercial real estate in Hong Kong and mainland China. The group's investment property portfolio valuation was also adjusted down by HKD 723 million. In addition, the group recorded a loss of HKD 305 million from its share of associates and joint ventures, mainly from an associate in mainland China.

During the period, the average return on assets decreased by 0.1 percentage points to 0.4%, while the average return on equity decreased by 0.9 percentage points to 3.1%. Net interest income decreased by 7.3% to HKD 15.322 billion. Due to falling interest rates, the net interest margin narrowed by 19 basis points year-on-year to 1.9%. Non-interest income increased by 28% to HKD 5.697 billion. Net service fee and commission income increased by 14.8% year-on-year to HKD 3.216 billion.

By the end of 2025, the total capital ratio, tier 1 capital ratio, and common equity tier 1 capital ratio are expected to rise to 28.2%, 24.7%, and 24.7%, respectively. The average liquidity coverage ratio for the quarter ending December 31, 2025, was 182.8%