Pressure Grows for Disposal of Bad Loans
By Maggie Zhang |
May 26, 2011, Thursday
|
Print Edition
Print Edition
BANKS in Shanghai face a growing pressure to dispose bad loans despite a decline in the size of the sour loans and percentage term for months, the local banking regulator said yesterday.
Loans with the worst quality, or loans classified as a loss, continued to rise in ratio and absolute terms in the first quarter, the Shanghai Bureau of the China Banking Regulatory Commission said in a statement yesterday.
China classifies bad loans into four categories - caution, subordinated, doubtful and loss. A loss represents the worse loan quality. Loans will be classified as "loss" when banks suffer wholly or almost wholly the principal and interests despite all efforts to reclaim them.
The loans classified as loss rose to 4.5 billion yuan (US$692 million) at the end of March, up 610 million yuan from the start of the year. The loss took up 18 percent of total bad loans in Shanghai, up 3.3 percentage points.
"The increase in loss is quite significant," the local regulator said. "It showed the difficulty in improving the structure of the bad loans and the growing pressure to dispose bad loans."
The total outstanding bad loans in Shanghai fell to 25.6 billion yuan at the end of March, down 1.6 billion yuan from the start of the year, or a drop for nine straight month. The sour loan ratio shed 0.07 percentage point to 0.73 percent in its 18th consecutive month drop.
Loans with the worst quality, or loans classified as a loss, continued to rise in ratio and absolute terms in the first quarter, the Shanghai Bureau of the China Banking Regulatory Commission said in a statement yesterday.
China classifies bad loans into four categories - caution, subordinated, doubtful and loss. A loss represents the worse loan quality. Loans will be classified as "loss" when banks suffer wholly or almost wholly the principal and interests despite all efforts to reclaim them.
The loans classified as loss rose to 4.5 billion yuan (US$692 million) at the end of March, up 610 million yuan from the start of the year. The loss took up 18 percent of total bad loans in Shanghai, up 3.3 percentage points.
"The increase in loss is quite significant," the local regulator said. "It showed the difficulty in improving the structure of the bad loans and the growing pressure to dispose bad loans."
The total outstanding bad loans in Shanghai fell to 25.6 billion yuan at the end of March, down 1.6 billion yuan from the start of the year, or a drop for nine straight month. The sour loan ratio shed 0.07 percentage point to 0.73 percent in its 18th consecutive month drop.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
