(Yicai) May 7 -- Almost 60 percent of listed banks on the Chinese mainland posted earnings growth in the first quarter, while several small and mid-sized lenders in economically developed regions reported double-digit gains.

Thirty-one of the 42 listed banks saw net profit increase in the three months ended March 31 from a year earlier, according to their latest earnings reports. Bank of Hangzhou’s profit grew the fastest, jumping 21 percent to CNY5.1 billion (USD706.5 million) on a 3.5 percent rise in revenue to CNY9.8 billion (USD1.3 billion).

Shaoxing Ruifeng Rural Commercial Bank, Changshu Rural Commercial Bank, Suzhou Rural Commercial Bank, Bank of Qingdao, Qilu Bank, and Bank of Chengdu also logged double-digit profit increases.

Twenty-seven lenders reported higher first-quarter revenue, led by a 19 percent jump at Bank of Qingdao to CNY3.7 billion. Its profit climbed 19 percent to CNY1.1 billion.

Urban and rural commercial banks in economically developed regions did particularly well, benefiting from the economic recovery in these places, which bolstered lending and swelled non-interest income from sources such as intermediary business and investments, an industry insider told Yicai.

But large state-owned banks continued to perform poorly. Earnings slumped at Bank of China, Industrial and Commercial Bank of China, Construction Bank of China, and Agricultural Bank of China. Only Bank of Communication saw an uptick in profit, which rose 1.4 percent to CNY25 billion (USD3.5 billion). Its revenue stayed flat at CNY67.1 billion (USD929.7 million).

Lenders remain under pressure from squeezed net interest margin, or the difference between what a bank earns in interest on loans and the amount it pays in interest on deposits, as interest rates fall. Five reported wider margins, while 34 logged declines, with the interest rate spread at most banks lower than the 1.8 percent acceptable to regulators.

The banks’ asset quality remained steady in the first quarter. The non-performing loan ratios at 30 banks dropped or remained the same, while that at 16 lenders fell to under 1 percent. Bank of Chengdu’s bad loan ratio was the best in the industry at 0.66 percent.

Editors: Dou Shicong, Kim Taylor