Top Chinese Banks Post Biggest Bad-Loan Surge Since 2010

http://www.bloomberg.com/news/2013-10-30...-2010.html
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Top Chinese Banks Post Biggest Bad-Loan Surge Since 2010
By Bloomberg News - Oct 31, 2013 11:01 AM GMT+1000

China’s top four banks posted their biggest increase in soured loans since at least 2010 as a five-year credit spree left companies with excess manufacturing capacity and slower profit growth amid an economic slowdown.

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Looks like its coming No wonder the government there is trying to do something about the excess capacity, they realise if they don't start somewhere, they gonna end up worse than USA!

Ah crash lai liao

Ref to the link: http://www.bloomberg.com/news/2013-10-30...-2010.html

"The ratio of nonperforming loans to total loans at the four largest banks rose to 1.02 percent as of Sept. 30 from 1.01 percent three months earlier, data compiled by Bloomberg News show, as lending continued to expand."

Analysts didn't believe on China's banks official number. The valuation given on China banks, are assuming a NPL of 5%, rather than the published of around 1%. The assumed NPL level seemed reasonable to me, base on observations on stakeholders.

In short, crashing seems still far away, with NPL already factored in.

(31-10-2013, 09:57 AM)CityFarmer Wrote: Ref to the link: http://www.bloomberg.com/news/2013-10-30...-2010.html

"The ratio of nonperforming loans to total loans at the four largest banks rose to 1.02 percent as of Sept. 30 from 1.01 percent three months earlier, data compiled by Bloomberg News show, as lending continued to expand."

Analysts didn't believe on China's banks official number. The valuation given on China banks, are assuming a NPL of 5%, rather than the published of around 1%. The assumed NPL level seemed reasonable to me, base on observations on stakeholders.

In short, crashing seems still far away, with NPL already factored in.

just like USA government is on life support since 2008, many chinese companies are also on life support. A lot of chinese companies depend on state subsidies to get by. Companies on the verge of bankruptcy get rescued in china instead of going under in an effort by the government to maintain a facade of a prosperous china.

Of course china can always devalue their yuan and do quantitative easing but at least now they are trying to do something about the excess.