Two Chinese Banks Feel Subprime Sting

Hong Kong–Two of China’s biggest banks were negatively affected by their U.S. subprime-related securities holdings, the New York Times reports.However, despite their subprime exposure, both the Industrial & Commercial Bank of China and the Bank of China both announced higher fourth-quarter profits on Tuesday.The Bank of China–which was most affected by the subprime collapse–said it held $5 billion in asset-backed securities at the end of last year, comprising 2.13 percent of its investment securities.However, the bank said it did not expect to post any future losses if it is able to dispose of its subprime holdings.Industrial & Commercial Bank held 1.23 billion in subprime-backed securities at the end of December 2007. The bank put aside $400 million for potential portfolio losses.