Editorial: have no fear over China bank NPLs
In the absence of a vibrant corporate bond market, China is relying on banks to achieve its target of 8% GDP growth this year. Consequently it has encouraged an almighty increase in lending, which will inevitably result in a rise in non-performing loans. But the nature of this totalitarian state means it really is nothing to fret about.
To help turn around its slowing economy, China has loosened lending constraints and encouraged banks to throw money at borrowers, so it will scarcely be a surprise if non-performing loans (NPLs) start to soar.
Over the past eight months, Chinese authorities have launched a huge financial stimulus plan
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