State Bank of Mauritius, the Indian Ocean island's second-largest bank, said on Tuesday first-half pretax profit rose 8.5 percent, boosted by dividend income, disposals, fees and commissions.

SBM, which has about a 25 percent market share, posted pretax profit of 1.38 billion rupees for the six months to December 31, 2010, up from 1.27 billion a year earlier. Earnings per share rose to 4.48 rupees from 4.29 rupees.

SBM shares climbed to 101 rupees on Friday, their highest level since June 2008, on expectations that higher fees and commissions would boost the bank's first-half results.

The shares closed on Tuesday at 96 rupees, before the results were released.

The bank said a 26 percent jump in non-interest income was down to "dividend income, profit from disposal of investments coupled with fee and commission income."

SBM said, however, that its results were dampened by the impairment of an equity investment in the tourism sector and higher taxes. The bank's net profit was up 4.6 percent from a year earlier at 1.16 billion rupees.

The bank is involved in retail and corporate banking, currency and securities trading, e-Business, leasing and asset management.

It said net interest income edged higher to 1.28 billion rupees from 1.24 billion. Gross loans rose 11.1 percent to 49.8 billion while deposits climbed 9.3 percent to 67.2 billion rupees.

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