China Construction Bank H1 profit rises 71 pct

HONG KONG, Aug 22 (Reuters) - China Construction Bank (0939.HK), the country's second-largest lender by assets, posted a 71 percent jump in first-half earnings, boosted by higher fee income and margins as mainland banks enjoy pricing power on loans.

Construction Bank (601939.SS), which is about 11 percent owned by Bank of America (BAC.N), earned 58.7 billion yuan ($8.58 billion) in the first six months of 2008, compared with 34.22 billion yuan in the same period last year.

Five analysts polled by Reuters were expecting the state-controlled lender to earn 58 billion yuan net profit in the first half.

In order to prevent economic overheating, Beijing has set quotas on loan growth for each bank. While that has curbed growth, continued heavy demand for credit by Chinese companies has given mainland lenders the ability to charge higher interest rates, boosting margins.

Shares in Construction Bank have fallen 10 percent in Hong Kong so far this year, compared with a 27 percent decrease in the benchmark Hang Seng Index .HSI during the same period.

(US$1=HK$7.8=6.844 yuan)

(Reporting by Kennix Chim, editing by Tony Munroe)