IMF Sees ‘Buildup’ of China Bank Risk Needing More Oversight

The International Monetary Fund called for China to expand oversight of banks as risks increase from off-balance sheet lending and a surge in property prices.

“Despite ongoing reform and financial strength, China confronts a steady buildup of financial sector vulnerabilities,” the Washington-based IMF said in its first formal evaluation of the Chinese system. Banks need to upgrade risk-management systems, the central bank and regulators should add skilled personnel and disclosure standards must be raised, the IMF said.