3 reasons behind BoCom's stable NIM in 2Q13

BoCom cut high cost deposits by RMB10b.

According to Barclays, BoCom continued to report relatively stable NIM, only a small decline of 3bps q/q to 2.54% in 2Q13.

Here's more from Barclays:

We believe it could mainly due to the following reasons:

1) Better asset allocation: In 1H13, the bank reduced its low-yield discounted bill loans by 47.8% h/h and increased its high-yield personal loans by 12.3% h/h.

2) Good liquidity management: Because of its generally tighter liquidity, BoCom has typically paid more focus on liquidity management. According to management, starting in May, BoCom's asset-liability department began to reserve more liquidity for the generally tight month of June. In fact, BoCom managed its interbank liabilities well (only +3.1% q/q) in 2Q13, therefore the bank suffered less negative impact from the interbank interest rate spike in late-June.

3) The bank also cut high cost deposits by several 10 billion RMB in 1H13.