SHANGHAI -- China Construction Bank, the country's biggest property lender, reported a 2 percent decline in net profit last year following the loss of a tax concession related to its restructuring the year before.

Net profit in 2006 was 46.3 billion yuan, or $6 billion, down from 47.1 billion yuan in 2005, said the bank, China's third-largest lender. But excluding the effect of the tax concession in 2005, net profit rose by 18 percent, it said.

The results, though slightly below analysts' forecasts, were an improvement from an 18 percent drop in first-half net profit after regulators tightened restrictions on lending.

Net interest income rose to 140.4 billion yuan ($18.2 billion) from 116.6 billion yuan the year before.

The bank is one of China's four big state-run lenders, with shares traded in Hong Kong.

The Construction Bank reported a pretax profit of 65.7 billion yuan ($8.5 billion) in 2006, up 18.7 percent from the previous year.

In the first-half of 2005, the bank was allowed a 7.85 billion yuan tax exemption linked to its restructuring ahead of the listing of its shares on the Hong Kong Stock Exchange in October of that year.

The bank has sought to balance its heavy exposure to the property market by expanding its small- and medium-size enterprise loans, credit card and personal loan businesses.

"While our traditional core businesses enjoyed steady growth, we were focused on developing our retail, international, treasury and wealth management businesses," the bank's president, Zhang Jianguo, said in a statement. "The strong business growth led to a significant rise in profitability."

The bank said Monday it plans to cooperate in a credit card business in "an appropriate timeframe" with Bank of America Corp., which holds an 8.52 percent stake in the lender.

China Construction Bank is already the country's second-biggest credit card issuing bank after China Merchants Bank Co.

"Our partnership with BAC will continue to improve product collaborative programs with the aim of improving product quality and processes," Zhang said.