China's lenders to face more bad loans

The chairman of China Construction Bank (CCB; 601939.SH, 0939.HKG) said Thursday that Chinese lenders may see more bad loans as the country’s growth declines, The Wall Street Journal reported. Wang Hongzhang encouraged commercial banks to accelerate lending to small outfits and set out certain industries that are more likely to default on their loans. Property, solar panel, steel and export industries are at high risk of default, as their prospects are susceptible to slowing foreign demand and weak domestic growth, he said. CCB has assessed the health of its loans and has taken measures to protect against bad debt and risk. “Asset quality will remain healthy,” Wang said. The comments come amid increaing concern from international investors over loan strength in China’s banks.