Banks around the world are flocking to China because of its fast growing economy. But their financial performance there so far isn't pretty.

Profits in China for banks based in other countries fell sharply last year, according to a report by accounting firm KPMG. At HSBC Holdings, the largest foreign bank in China, after-tax profits declined 60% from 2008 to 718 million yuan (€82m). In contrast, Chinese banks posted double digit percentage gains in after-tax profits.