Chinese non-performing loans decrease
(7 April 2017 – China) Following the latest round of bank results, it has emerged that bad debts among China’s five largest banks have improved, assisted by a healthier macroeconomic environment.
In the last quarter of 2016, four of the five banks: China Construction Bank (CCB), Agricultural Bank of China (AgBank), Bank of China (BOC), and Bank of Communications reporter better bad loan to loans rations, Industrial & Commercial Bank of China (ICBC) remained broadly unchanged.
Construction Bank’s debt-for-equity swaps will exceed 300 billion yuan (US$43.6 billion) by the end of the first quarter of 2017, the bank’s president Wang Zuji said at a press briefing.
Agricultural Bank’s president Zhao Huan said that his bank’s program so far was worth 70 billion yuan from eight deals and that there were 20 more swaps to come.
Concerns, however, remain over whether debt swaps truly transferred risks away from the banks, as well as in the value of the NPL figures as an indicator of asset risk.
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