China Banks Bad Loans Surge Most on Record Amid Deleveraging
- Soured debt as share of total advances hits highest since 2009
- China started tapping breaks on deleveraging as economy slows
Photographer: Tomohiro Ohsumi/Bloomberg
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Chinese banks’ bad loans increased by a record last quarter, a potential setback for authorities struggling to encourage lenders to extend more credit.
Non-performing loans rose 183 billion yuan ($26.6 billion) to hit 1.96 trillion yuan by the end of June, the biggest quarterly jump in data going back more than a decade, the China Banking and Insurance Regulatory Commission said in a statement on Monday. Soured loans represented 1.86 percent of total advances, the highest ratio since March 2009.