Chinese banks could see net profit growth slow to 9% in 2014 from 14.5% a year earlier, Reuters reported, citing a new report by the China Banking Association. “Banking institutions face challenges from increased volatility of short-term liquidity and rising credit risks due to the impact from economic slowdown, structural adjustment and efforts to reduce overcapacity,” said the report. Domestic lenders recorded net profit of RMB1.42 trillion (US$228.9 billion) in 2013. “Market risks will rise along with interest rate liberalization, increased exchange rate flexibility and more frequent capital flows, but there will be no large-scale outbreak of liquidity risks.”
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