For the three months that ended June 30, nonperforming loans (NPLs) accounted for 1.74% of outstanding loans of all Chinese commercial banks combined, according to data from the China Banking Regulatory Commission (CBRC). The NPL ratio has been the same since the fourth quarter of 2016. In yuan terms, however, NPLs rose to 1.64 trillion yuan ($245.5 billion) as at the end of June, an increase of 56.3 billion yuan from the end of March, the CBRC said. Also, rural commercial banks faced the worst asset deterioration among all banks. Rural banks saw bad loans increase by 15% from the first quarter to reach 297.6 billion yuan, reflecting an NPL ratio of 2.81%, the regulator said. A CBRC-led audit at the beginning of this year found that actual bad loans were higher than what the banks had on the record, a vice director of a provincial branch of the banking regulator told Caixin.
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