ArrowArtboardCreated with Sketch.Title ChevronTitle ChevronIcon FacebookIcon LinkedinIcon Mail ContactPath LayerIcon MailPositive ArrowIcon PrintIcon Twitter
Finance

China bank balance sheets put to test by coronavirus impact

Lenders to have to set aside billions more in capital to cover soured loans

HONG KONG -- Chinese banks are at risk of having to set aside billions of dollars more to cover loans that have gone sour due to the coronavirus pandemic, complicating Beijing's attempt to reignite the economy.

Analysts expect China's big listed banks to make much higher bad-loan provisions on their balance sheets as a result of accounting standards implemented since the 2008 financial crisis. Higher provisions will squeeze profits and capital levels, restricting banks' ability to lend to stimulate the economy.

Sponsored Content

About Sponsored Content This content was commissioned by Nikkei's Global Business Bureau.

Nikkei Asian Review, now known as Nikkei Asia, will be the voice of the Asian Century.

Celebrate our next chapter
Free access for everyone - Sep. 30

Find out more