China’s top lenders have reported an increase in bad loans during the first half of the year amid predictions that credit problems in the property sector will grow worse, reports Nikkei Asia. The state-owned Industrial and Commercial Bank of China (ICBC), Bank of China (BOC), China Construction Bank (CCB) and Agricultural Bank of China (ABC) said in recent days that their total nonperforming loans (NPLs) reached RMB 1.202 trillion ($164.8 billion) in the first six months of 2023, up 7.6% from RMB 1.117 trillion at the end of last year.
The reports came as the crisis in the country’s property sector deepened. Country Garden Holdings, a leading private property developer by sales, on Wednesday reported a net loss of RMB 48.9 billion in the first six months of the year after missing interest payments on two U.S. dollar-denominated bonds.
“Banks’ bad debts to the property sector are not reaching the peak level anytime soon, as many top companies have only started to report questions,” said Weiqing Li, a seasoned banker and member of the Private Banking Committee of the China Banking Association.
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