State-owned Bank of China Ltd (stock code: 601988) is expected to report tomorrow first-half to June net profit of between 25.14 bln and 29.71 bln yuan, up 29-53 pct from 19.48 bln achieved a year earlier, with revenue boosted by loan growth and strong fee income.

Analysts agree the bank's profit growth in the period was curbed by a one-off deferred tax asset write-off, which had been factored into the brokerages' forecasts.

Due to a reduction in the corporate income-tax rate to 25 pct from 33 pct, which takes effect next year, the bank is booking deferred tax asset write-offs this year, in accordance with international accounting standards, resulting in a higher tax expense.

Among securities brokerages polled by XFN-Asia was Credit Suisse, which said it expects Bank of China's net profit for the six-month period to show a 39 pct year-on-year rise to 27 bln yuan, driven mainly by net interest margin (NIM) expansion and strong fee growth.

Credit Suisse estimates the bank booked deferred tax asset write-off of 4.2 bln yuan for the period.

The brokerage estimated NIM at 2.71 pct, up from 2.62 pct in the second half last year, due mainly to the bank's strong loan business in mainland China.

It said net interest income should come in at 72.46 bln yuan, up 32 pct from a year earlier, driven by 9 pct estimated loan growth, while net fee income should have risen about 59 pct to 10.85 bln yuan due to the strong fund sales in Hong Kong and mainland.

JP Morgan forecast the bank would post net profit of 27.6 bln yuan, up 42 pct year-on-year, based on a fee income increase of 70 pct to 11.62 bln yuan, and strong loan growth.

Excluding the estimated one-off tax charge of 4.2 bln yuan, Bank of China's net profit should rise by more than 50 pct, JP Morgan said.

Citigroup gave the most optimistic forecast for the bank, seeing 53 pct growth in net profit at 29.7 bln yuan. It said profit for the period would have been driven by NIM expansion to 2.7 pct from 2.12 a year earlier, as well as strong fee income growth.

The investment house said fee income should come in at 11.63 bln yuan, up 70 pct, while net interest income rose 32 pct year-on-year to 72.18 bln yuan.

It said the bank's 1.5 bln yuan net forex losses in the first half should be manageable.

Meanwhile, UBS said it expects Bank of China to report a 29 pct rise in net profit to 25.14 bln yuan for the six-month period.

Daiwa Securities estimates the net profit figure to come in at 26.31 bln, up 35 pct. It sees one-off deferred tax asset write-off of 4.19 bln yuan.