China CITIC Bank's profit growth slows

China CITIC Bank, one of China's leading banks, posted slowing profit growth and rising bad loans in the first quarter (Q1) of the year as the previously lucrative sector feels the pinch of a slowing economy.

The bank registered net profits of 10.93 billion yuan (1.78 billion U.S. dollars), up 2.07 percent from a year ago, according to the Q1 report filed with the Shanghai Stock Exchange on Saturday.

The growth rate was much lower than the 16.14-percent increase seen during the same period last year.

CITIC was not the only commercial bank in China feeling the chill from the economic downturn as profits earned by China's major banks slowed to the single digits across the board last year.

The bank said in the report that it is facing increasing challenges from financial disintermediation, interest rate liberalization and fierce competition amid the slowing economy and ongoing reform.

The bank is reinforcing its ability to fend off risk while trying to expand profits, the report said.

Total turnover of the bank increased 10.71 percent to 32.99 billion yuan in the Jan.-March period.

As of March, outstanding non-performing loans (NPL) grew 6.23 percent to 30.23 billion yuan from the end of 2014, and the NPL ratio rose to 1.35 percent.

On the stock market, the company dropped nearly 2 percent to finish at 7.89 yuan per share on Friday.