China Construction Bank Corp (CCB) has a low risk exposure to the country's stock markets, with less than 20 billion yuan ($3.14 billion) of loans collateralized with stock and 50 billion to 60 billion yuan in credit lines provided to securities firms, Chairman Wang Hongzhang said on Monday.

Less than 40 billion yuan, or about one-third of the bank's wealth management products, are invested in the stock market, Wang said at a press conference in Beijing. CCB is the country's second-biggest lender by assets. Speaking at the same event, the bank's Executive Vice President Zhang Gengsheng said the firm had lent State margin lender China Securities Finance Corp 148 billion yuan, a figure he said was small compared to other banks.

He noted that he expects the bank's asset quality will deteriorate during the second half of the current year.

CCB on Monday reported lackluster half-year profits and increased nonperforming loans. The bank's net profit for the January-June period rose just under 1 percent year-on-year to 131.90 billion yuan ($20.64 billion), the bank said, just a fraction higher than the 130.66 billion yuan for the same period last year.

At the same time, its bad loans rose to 144.40 billion yuan by the end of June, implying a nonperforming loan ratio of 1.42 percent, said the statement issued by the bank to the Shanghai Stock Exchange on Monday.

The ratio was up by almost a fifth from the 1.19 percent at the end of last year.

"As economic growth slows down and certain businesses and industries suffer operational difficulties, the banking industry comes under pressure for maintaining asset quality," the bank said.

China's economy grew 7.0 percent in each of the first two quarters, slowing from a 7.4 percent expansion last year, which was its weakest since 1990.

CCB said interest rate reform in China will also affect its performance in the second half as it brings greater competition.

In August, China allowed interest rates for fixed deposits of more than one year to float freely though other deposit rates are still set based on guidelines from the central bank.

The government already allows banks to set their own lending rates, and banks say the moves toward greater liberalization have cut into their profits.

CCB shares closed up 0.58 percent in Shanghai Monday.