SHANGHAI :
Bad Loans Mount at China’s Big Listed Banks as First-Quarter Profits Hold Up
Liao Shumin
DATE:  Apr 30 2020
/ SOURCE:  Yicai
Bad Loans Mount at China’s Big Listed Banks as First-Quarter Profits Hold Up Bad Loans Mount at China’s Big Listed Banks as First-Quarter Profits Hold Up

(Yicai Global) April 30 -- Dud loans increased at China’s biggest public banks in the first quarter amid the coronavirus lockdown while their profits proved resilient.

Of the 15 lenders that had reported earnings as of yesterday, including state-owned Industrial and Commercial Bank of China, China Construction Bank, and Bank of China, only Shanghai Pudong Development Bank managed to cut its non-performing loan ratio.

The bad debt ratio at Bank of Communications rose 12 basis points to 1.59 percent and 2 points at BOC. Those at ICBC, CCB, Agricultural Bank of China, and Postal Savings Bank of China remained basically the same from a year earlier.

China Merchants Bank predicts that the higher risk of defaulted personal loans could continue in the second quarter as employment and salaries have been affected by the Covid-19 outbreak.

Ping An Bank expanded on the reason for increased risks. The rise in defaulted personal loans was caused by financial distress as the outbreak struck consumer demand and incomes.

Profit growth held firm, however, with three of the lenders achieving double-digit growth. Ping An Bank's net profit gained 15 percent from a year ago, while China Everbright Bank’s rose 11 percent and China Merchants Bank’s 10 percent. CCB had a 5 percent increase, Agricultural Bank of China logged 4 percent, and BOC reported a 3 percent increase.

Editor: Emmi Laine

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Keywords:   Bank,Financial Result,Nonperforming Loans