Agricultural Bank of China, one of the country's big four lenders, said Wednesday first-half profit rose 20.8 percent, driven by interest income growth despite the country's slowing economy.
AgBank, the country's biggest rural lender by assets, said in a filing to the Hong Kong bourse that net profit for the six months to June 30 was 80.52 billion yuan ($12.67 billion), up from 66.67 billion yuan a year ago.
Net interest income, which accounts for nearly 80 percent of its operating income, rose 15.86 percent to 167.69 billion yuan.
"At present, the banking industry in China is facing complex and challenging internal and external situations," chairman Jiang Chaoliang said, citing the European sovereign debt crisis and China's slowing economy as factors.
"In view of regulatory policy environment, marketisation reforms of China's financial markets have accelerated and commercial banks are being challenged by intensifying competition and risk exposure," he added.
Company president Zhang Yun said the bank faces "even more complex and stern challenges" in the second-half.
Chinese Premier Wen Jiabao has called for the break-up of a banking "monopoly" on lending that has squeezed private businesses, which fuelled resentment as companies struggle to access much-needed credit.
Beijing said in June that it would set new rules for bank's capital requirements from January next year, in line with international moves aimed at reducing risk.