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Citic Group sees slight drop in annual net profit in '08
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Citic Group, the parent company of Citic Securities and China Citic Bank, estimated a slight drop in net profit from 15.97 billion yuan last year to more than 14 billion yuan (US$2.06 billion) in 2008 on Wednesday.

Though influenced by the global financial crisis, the company has seen stable development in all areas of business, especially in banking, securities and machine manufacturing, said a company official.

The total assets of the company is estimated to reach 1.6 trillion yuan, up 18.8 percent from 1.3 trillion yuan last year. Business revenue reported 150 billion yuan, up 37.2 percent from 109.35 billion yuan last year.

The Citic Pacific, a Hong Kong-listed affiliate of the Citic Group, is to restore normal operations, said the company in a press release, without revealing when or giving any further details.

Citic Pacific said on Oct. 20 that it had incurred heavy losses from a number of foreign exchange contracts. The potential losses from bets without proper authorization totaled up to 14.7 billion Hong Kong dollars (US$1.88 billion).

The Securities and Futures Commission (SFC) of Hong Kong later started formal investigation into the case.

The company's share price plummeted about a half on Oct. 21, followed by a further decline of 24.69 percent on Oct. 22 after the SFC statement came out.

In November, the Citic Group announced it would provide US$1.5 billion to rescue its ailing affiliate by buying its convertible bonds. After the transaction, Citic Group's stake in the Citic Pacific would increased to 57.6 percent from 29 percent, according to previous reports.

The transaction was completed on Dec. 24, Citic Group said.

Citic Pacific share price has tumbled more than 61 percent since October.

(Xinhua News Agency January 22, 2009)

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