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Bad loans still a major issue for Chinese banks

Bad loans still a major issue for Chinese banks

(21 November 2005 – China) China’s banking regulator has said domestic banks are suffering from increasing volumes of bad debt. "Some banking institutions have experienced a rebound in bad loans," the China Banking Regulatory Commission said.

Despite an improvement in bad loans over the past couple of years, the regulator said it was still an issue in the Chinese banking system.

"Currently the volume of bad loans within the banking system is still very high. The pressure for them to rebound is remarkably high," the commission said.

It said bad loans accounted for more than eight percent of all loans, some 1.3 trillion yuan in total.

The commission said lending growth was starting to slow although it was still up 13 percent on last year.

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