Top Chinese bank regulator warns of loan growth risks

Discussion in 'Economics' started by ASusilovic, Jul 20, 2009.

  1. TOKYO (MarketWatch) -- China's top banking regulator issued a strongly worded warning over the weekend about the risks of his country's surge in loan growth in the first half of this year, according to reports.

    "(We) must control the risk of real-estate loans," said Liu Mingkang, the head of the China Banking Regulatory Commission, was quoted as saying by Reuters.

    "In the first half of the year, our country's banking loans expanded rapidly and helped play an important role in stabilizing the economy, but the loans growth has led to accumulated risks also increasing," he said in a statement dated Saturday.

    Liu said banks should strictly follow criteria for granting loans on second mortgages, closely observe capital adequacy ratio standards and ensure the quality of loans.

    Chinese banks made 1.53 trillion yuan ($223.9 billion) last month, more than double the 664.5 billion yuan in lending seen in May, according to data released earlier this month by the People's Bank of China. See full story on Chinese bank lending data.

    That brought aggregate new lending to date for 2009 to 7.37 trillion yuan, up 201% from the first half of 2008, and already well above the official full-year target of 5 trillion yuan

    At least they are aware of it...
  2. Once the Chinese say there is "no bubble" and bad loan problems are "contained" we know troubles lie ahead :cool:
  3. Apparently this is a non-news because the Hang Seng is up 500+ points right now. This over bullishness is worrying.
  4. This lending stimulus is most likely all smoke and mirrors, China's economy is going to totally collapse.
  5. joesan


    You mean like this one ?

    ( A collapsed apartment building in Shanghai this June, it was still under construction when it collapsed . )

  6. kxvid


    Eventually, the question is when. The world GDP of 2100 is estimated to be less than 1/10 that of 2000.
  7. Who estimated that, I wonder? Is it a real or nominal GDP estimate?
  8. It's a stupid estimate. ignore and move on
  9. I know, but I'd like to know what economic genius is behind it... Maybe they make unusual assumptions, like wars etc.