China's Big Four state banks had an average non-performing-loan (NPL) ratio of 16.86% at the end of last year, down 4.71 percentage points from the previous year, the China Banking Regulatory Commission (CBRC) said.
The four – Industrial and Commercial Bank of China (ICB), Bank of China (BOC), China Construction Bank (CCB) and Agriculture Bank of China – had RMB 1.59 trillion in bad loans at the end of the year, the regulator said.
For BOC, the country's second-largest lender by assets and its oldest bank, the year's effort saw it write off RMB 72.4 billion of bad debt ahead of a planned initial share sale next year.
China plans to sell stakes in BOC, CCB and two other state-owned lenders to reduce bad loans estimated at more than 20% of their total lending.
ICB, China's largest bank, said it wrote off RMB 60 billion of bad loans last year.
The lender's bad-loan ratio fell to 21.3% during the year from 25.5% at the end of 2002.
In early January the central government used the country's foreign reserves to inject US$22.5 billion each into BOC and CCB and may inject US$40 billion into ICB as it accelerates a program to help state banks reduce bad loans before selling shares to the public.