BANK of Communications said yesterday profits for its first three quarters rose 56.8 percent from a year earlier, while growth slowed from the 81.2-percent first half growth in line with the economy slowdown.

The bank, 18.6 percent owned by HSBC Holdings Plc, said yesterday its nine-month net profit rose to 22.72 billion yuan (US$3.32 billion) under international accounting standards.

The bank said it had taken measures to adjust its structure in the face of a complex global economy and had maintained a relatively fast development rate for business.

Qian Wenhui, vice president of the bank, said the lender was relatively insulated from the global financial crunch as it had been prudent on overseas bonds investments and the Chinese banking industry hadn't stepped much outside of the home market.

The bank wrote down 1.16 billion yuan on overseas currency denominated bonds in the first three quarters against its total of US$4.77 billion such bonds as at the end of September.

The bank said it had disposed of all debt issued by Fannie Mae and Freddie Mac, the two biggest United States home loan companies. The bank held Lehman Brothers bonds valued at US$70.02 million and had made 85 percent provision against impairment losses, it said.

The bank's total forex bonds accounted for 1.3 percent of its total assets and the impact was relatively limited, the bank said. It said it had issued 7.7 million co-branded credit cards with HSBC as of the end of September, up from last year's 4.45 million.

The bank's bad loan ratio dropped to 1.75 percent as the end of September, down 0.30 percentage points.

China banks are facing a tough year as the economy slows, and risks of more loan defaults increase.