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Bank of China Ltd said "isolated" cases of irregularities and compliance breaches uncovered during a government audit last year won't affect its financial results, Bloomberg reported today.

The National Audit Office found incidents including failure of branches to adhere to the government's macro-economic controls and the bank's own credit approval policies, the nation's second-largest bank said in a statement.

The investigation, carried out between April and September last year, also uncovered improper recording of income and expenses, the Beijing-based lender said. It identified risks in a small number of highway construction loans and Bank of China's disposal of non-performing assets.

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China's biggest state-owned banks are improving internal controls and risk management to root out fraud, scandals and embezzlement after they sold shares to the public and complied with stricter regulations.

Several senior bank executives including Liu Jinbao, former chief executive of Bank of China's Hong Kong operations, and Wang Xuebing, who headed China Construction Bank, have been sentenced to prison terms on corruption charges in recent years.

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