Skip to content
Subscriber Only

Mounting Signs of Bank Stress in China Prompt Government Action

  • Authorities are said to draft sweeping plan including mergers
  • ‘Regulators can’t deal with all risky institutions at once’
Daily Life Across China
Photographer: Luke MacGregor/Bloomberg

Signs of stress within China’s legion of small banks are cropping up across the country.

On Thursday, Guangdong Nanyue Bank made a rare decision to skip early redemption on its local tier-two bond without giving a reason, sparking fresh concern about its financial strength. Two other banks have faced runs at some branches in recent days amid unsubstantiated rumors on social media that they might fail. Many other lenders are embarking on efforts to bolster capital.