, Columnist
A Wave of Bad Loans Could Swallow China's Banks
Don’t be fooled by the relatively flat non-performing figures. More trouble lies ahead.
It's coming.
Photographer: BRIAN BIELMANN/AFPThis article is for subscribers only.
As China recovers from Covid-19, all eyes are on its banks’ bad loans. The reality is far worse than it looks.
China’s largest lenders reported quarterly earnings this month, the first since the viral outbreak shuttered large swathes of the economy. The stock of non-performing loans rose for all of them — some more than others — but total loans went up, too. As a proportion, NPLs were basically flat. Breakdowns on types of souring loans were sparse, leaving investors with few clues about the real state of things.