Latest News:  
Beijing   Sunny    20 / 5 ℃  City Forecast

People's Daily Online>>China Business

Amount of bad loans may rise, says Deloitte

By Chen Jia  (China Daily)

08:43, April 06, 2012

Weak property market and slow economic growth cited as causes

China's banks may see a moderate rise in the amount of non-performing loans this year as the property market weakens and economic growth slows, putting more pressure on the asset quality of lenders, according to a report from Deloitte China.

Loan defaults from companies in the real estate sector may be the biggest potential risk in 2012, because developers' financial condition is deteriorating while the government is unlikely to alter its policies to control the property sector in the short term, according to the report released on Thursday.

However, the loan risks to local governments' financing platforms will be "fundamentally under control", said the report.

According to data from the China Banking Regulatory Commission, by the end of last year, the total amount of commercial banks' non-performing loans had reached 427.9 billion yuan ($67.8 billion), 20.1 billion yuan more than that in the third quarter of 2011. The bad debt ratio was 1 percent.

"The number of non-performing loans is expected to slightly increase in the next two years, but it may not change a lot from last year's situation," said Wang Pengcheng, co-leader of Deloitte Global Financial Services Industry. He didn't give a specific prediction for 2012.

A forecast by Citic Securities indicated that the volume of Chinese banks' bad debt may increase by 5 to 10 percent during 2012, while the non-performing loan ratio will be less than 1.3 percent, amid the sluggish economic environment and falling profits.

【1】 【2】


Leave your comment0 comments

  1. Name


Selections for you

  1. Thunderstorm hits Hong Kong

  2. China's own watch brand Sea-Gull prospers in decades

  3. Chinese people commemorate martyrs on Tomb-sweeping Day

  4. Kimchi Field Museum in Seoul, South Korea

Most Popular


  1. Anelka cannot save Chinese football
  2. Quick stop to good progress in N.Korea
  3. EU urged to do Chinese companies justice
  4. A hard-earned, favorable turn for Syria issue
  5. BRICS mulls joint bank
  6. How far away are we from nuclear terrorism?
  7. Benefits, not values, define BRICS unity
  8. China slams Japan's move over Diaoyu Islands
  9. More efforts needed for enhancing nuclear security
  10. Chinese solar companies to fight US tariffs

What's happening in China

Xihu Longjing tea harvest season begins

  1. China's Suning to open 426 chain stores in 2012
  2. Service business index rebounds in March
  3. HK luxury retailer eyes expansion in mainland
  4. Waste plastic factory ablaze in Ningbo
  5. Probe launched in land seizure

PD Online Data

  1. Spring Festival
  2. Chinese ethnic odyssey
  3. Yangge in Shaanxi
  4. Gaoqiao in Northern China
  5. The drum dance in Ansai