Big four Chi­nese banks re­port ris­ing bad loans

The Myanmar Times - - International Business -

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. –

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