China Debt Headache Swells as Bank Breaches Bad-Loan Buffer

  • Bank of China's coverage ratio falls below 150% for first time
  • IMF staff members warn China bad-loan plan may backfire

A slide in Bank of China Ltd.’s bad-loan buffer to below a regulatory minimum added to signs that the authorities could be set to loosen standards for how the country’s banks provision for a growing mountain of nonperforming credit.

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