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First Quarter Bad Bank Loans in China Hit a 16-Year High
May 13, 2019
Non-performing loans (NLPs) in Chinese commercial banks increase to 2.16 trillion yuan (₹317.66 billion) end of March 2019. It is the highest since 2003. The NPLs increased to 95.7 billion yuan compared to the start of the year and industry-wide NPLs ratio reduced marginally to 1.8% at the end of the first quarter. The same figure stood at 1.89% at the end of 2018.
The data on bad loans comes when the Chinese government is trying to push the bank to lend more to small and medium-sized companies to tackle the slowdown in the Chinese economy. To combat possible system financial risks, the Chinese authorities have brought more stringent rules that require the lenders to identify bad loans as well as defaulted bonds, off-balance sheet businesses, falling interbank assets as NPA, or non-performing assets.
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