Big four Chinese banks report rising bad loans
ALL of China’s “Big Four” stateowned banks reported mounting bad loans in the first half of the year, statements showed, as the world’s second-largest economy faces souring debt amid slowing growth.
The Industrial and Commercial Bank of China, the world’s biggest lender by assets, said its non-performing loan (NPL) ratio rose to 1.55 percent at the end of June, up from 1.5pc at the end of last year, according to a statement to the Hong Kong stock exchange filed on August 30.
Even so its net profit for the first six months edged up 0.8pc year-onyear to 150.66 billion yuan (US$22.6 billion), it said.
China’s three other giant stateowned banks have reported similar results in recent days, with all of their bad loan ratios creeping upwards as Beijing seeks to boost the the economy with an infusion of cheap credit.
Analysts have warned that a debtfuelled rebound might be short-lived and ballooning borrowings risk sparking a financial crisis as bad loans and bond defaults increase.
Bank of China’s earnings statement showed its NPL ratio rising to 1.47 at the end of June, up from 1.43 in December.
The number two lender, the China Construction Bank,reported its NPL ratio had risen 0.05 percentage points to 1.63pc, while the Agricultural Bank of China recorded a figure of 2.4pc, slightly higher than last year.
China’s total debt hit 168.48 trillion yuan at the end of last year, equivalent to 249pc of national GDP, top government think tank the China Academy of Social Sciences has estimated. –