Executives at China Citic Bank Corp, the country's seventh-largest lender by assets, said they're content with the bank's single-digit profit growth and will step up efforts to cut funds invested in debt that is not publicly traded.

Zhu Xiaohuang, president of the bank, said at a news briefing on Wednesday that he's satisfied with the interim results, especially the year-on-year increase in net profits, although it's only 5.3 percent.

"The results suggested we have realized our strategic goals in this phase and every aspect of the business is moving in our expected direction."

The 5.3 percent increase in net profit is an improvement from 2012's 0.7 percent growth, but might be spurred by weaker provisions the bank allocated for bad loans, analysts have said.

Its provision coverage ratio declined to 223.9 percent at the end of June from 288.3 percent six months earlier.

The bank, in which Spain's Banco Bilbao Vizcaya Argentaria SA has a 15 percent stake, is the domestic banking arm of the Citic Group, which operates under the direction of the State Council.

"What I worry about most is the deteriorating asset quality," Zhu said. China Citic Bank experienced a surge of 4.1 billion yuan ($0.67 billion) in bad loans in the first half. The ratio of non-performing loans to total lending also went up by 0.16 percentage points to 0.9 percent.

Businesses' rising defaults and the authorities' efforts to gradually liberalize interest rates have widened the performance gap among Chinese commercial lenders.

The regulator's tightened control over shadow banking activities, especially non-transparent investments using funds gained by selling wealth management products, are also expected to hit joint-stock lenders.

Funds invested in debt that is not publicly traded stood at 202.1 billion yuan at the end of June, of which 83.7 billion yuan exceeded the regulation line set by China Banking Regulatory Commission, said Zhang Qiang, the bank's vice-president.

In the first half, the bank sold wealth management products valued at 692.6 billion, he said.?

"In the second half we would continue to squeeze those assets that exceeded regulation ceilings, and hopefully we can meet CBRC's standards by the year end."