China's biggest commercial bank, the Industrial and Commercial Bank of China (ICBC), said in Beijing Monday its non-performing loan (NPL) ratio declined to 20.2 percent by the end of March.

ICBC either wrote off or recovered 19.6 billion yuan (over 2.12billion US dollars) in NPLs in compliance with the internationally accepted five-category loan classification system in the first quarter of 2004.

The bank announced earlier an initial public offering plan scheduled for 2006, but a pile of bad debts are still hindering its ambitious goal, analysts said.

The State Council, or the central government, injected 22.5 billion dollars in foreign exchange reserve into the bank by the end of last year to help it increase capital in cash.

According to the bank, its operating profits rose to 18.2 billion yuan (about 2.2 billion dollars) by last month-end, an increase of 4.7 billion yuan (some 566.3 million dollars) from a year ago.

However, as much as 16.71 billion yuan (2.01 billion dollars) from the profits was used to set provisions for bad debts and dispose of the existing NPLs.

The bank also posted a robust growth in its consumption-driving loans, e-banking business and intermediate business in the first three months of the year.