China’s Small Lenders Are Filling Up on Riskiest Bank Debt
- Small banks have issued 70% of perpetual bonds this year
- Banks rushing to boost capital amid mounting bad debt
The Jin Mao Tower, foreground, the Oriental Pearl Tower, center, and other buildings are seen from the Shanghai World Financial Center in Shanghai.
Source: Bloomberg
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China’s cash-strapped small lenders are expanding their pile of the riskiest kind of bank debt to shore up their capital levels, bracing against an economic slowdown and rising loan defaults.