* Q3 net 33.6 bln yuan vs 32.6 bln consensus
* Loans rose 2.6 pct from end-June, slowing from H1
* Margin stabilisation may bring relief - analyst (Releads, adds analyst comment)
By Michael Wei and Doug Young
BEIJING/HONG KONG, Oct 29 (Reuters) - Slowing loan growth could be a drag on profits at Industrial & Commercial Bank of China (ICBC) next year, after a lending boom earlier this year helped the world's most valuable bank post a 19 percent jump in third-quarter profit.
Loans granted by China's banks totalled 7.4 trillion yuan in the first half, triple the year-earlier level, before falling significantly in July and August. But lending picked up surprisingly in September to 517 billion yuan ($75.7 billion).
Looming over Chinese banks now is the question of how they will pace their lending in 2010, as they are on track to issue about 10 trillion yuan this year. Few analysts think this year's level will be sustainable.
Domestic rivals China Construction Bank and Bank of Communications have already reported a slowdown in loan growth in the third quarter.
ICBC, in which Goldman Sachs, Allianz Group and American Express hold stakes, said loans and advances totalled 5.58 trillion yuan ($817 billion), as of end-September.
Compared with 5.44 trillion yuan in loans at end-June, the third-quarter figure was only up 2.6 percent -- a sharp slowing from the 19 percent loan growth ICBC recorded in the first half.
Concerns are growing that China might lean on banks to tighten lending, eating into profit as the country reins in its ultra-relaxed monetary stance under its economic stimulus programme.
But there are bright spots that could bring relief, some say.
"An expected drop in bank loans next year would not dampen banks' earnings as long as net interest margins, which already bottomed out, pick up next year after falling sharply in 2009," said Simon Ho an analyst at Citigroup.
"If net interest margins stabilise or recover next year, loan growth would translate into earnings growth."
Chinese lenders have seen shrinking margins following five interest rate cuts since last September as the government spurred lending to sustain growth in the global economic crisis.
ICBC's net interest income fell to 178.2 billion yuan in the first nine months of 2009, down 9.42 percent from the same period of last year.
After declining for most of the year, net interest margins began stabilising in the second quarter and are expected to rise in the final quarter this year and next year.
ICBC, with a market value of roughly $500 billion, reported July-September earnings of 33.6 billion yuan ($4.92 billion), compared with 28.2 billion yuan a year earlier, and a touch above the 32.6 billion yuan forecast by seven analysts polled by Reuters.
Ahead of the results, ICBC's Hong Kong-listed shares ended down 2.7 percent in a market that fell 2.3 percent. The shares are up about 49 percent so far this year, matching gains in the benchmark Hang Seng Index. ($=6.83 yuan) (Editing by Chris Lewis and Muralikumar Anantharaman)