Reports on China’s bad loans disappear on social media
A series of research reports from Chinese brokerages on the nation’s recent bad credit data disappeared from social media over the weekend, highlighting the increasing difficulty of getting reliable information about the world’s second-largest economy.
At least seven research reports from mainland brokerages and securities firms that had been posted to WeChat by analysts were unavailable for viewing yesterday.
ERROR MESSAGE
The link to six of the reports now leads to an error message saying the content could not be viewed after complaints about unspecified contravention of rules governing public accounts.
A report from China Merchants Securities Co was deleted from a WeChat account where the brokerage’s fixed-income analyst Zhang Wei usually posts research, according to a screenshot of the posting viewed by Bloomberg News.
Reports from analysts at Zheshang Securities Co, Guosheng Securities Co, GF Securities Co, China International Capital Corp, Shenwan Hongyuan Securities Co and Soochow Securities Co were also unavailable for viewing or had been taken down before yesterday morning.
None of the seven companies responded to requests for comment.
China has increasingly hidden negative data over the past few years, making it harder for investors to accurately judge what is happening in the economy. The nation’s exchanges were set to switch off a live feed of foreign money flows into stocks as early as yesterday, the latest example of closely-watched information being removed.
WEAK DEMAND
The data released over the weekend showed that total credit demand fell last month for the first time since 2005. That unexpectedly bad result was driven by weak demand from companies and households to borrow, and also by local governments across the country pulling back on selling bonds.
China’s top securities newspapers attempted to put a positive spin on the data. A front-page article in China Securities Journal yesterday suggested the credit data would stabilize and pick up once the government started issuing more bonds.
The central government said it would start selling ultra-long bonds from Friday, although that likely would not immediately turn around the falling demand for mortgage loans from households or the weak demand from companies to borrow money.