Bank of China (BOC), the mainland's second-largest lender, said its 2006 net profit soared 65 percent, on strong operating income and reduced taxes.

The bank notched up a net profit of 42.83 billion yuan last year under international accounting standards, compared with 25.92 billion yuan a year ago. The net profit was higher than its initial public offering forecast of 33 billion yuan for the full year. Operating income rose 18.6 percent year-on-year to 148.38 billion yuan.

The bank's non-interest income grew 12.07 percent to 27.01 billion yuan, which, excluding losses from forex exposure, accounted for 23.3 percent of its total operating income, up from 22.2 percent in 2005. Net interest income rose 20.16 percent to 121.37 billion yuan from a year earlier.

The bank paid an estimated 4.6 billion yuan less in taxes last year due to a pre-tax deduction of total domestic staff salary costs for 2006, approved by the tax authority.