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Finance

China banks' profit revival falters

Lenders still making bigger bad debt provisions than expected

Industrial and Commercial Bank of China's headquarters branch in Beijing. Chinese banks face a Catch-22 in resolving the issue of mounting debt at state-backed companies.   © Reuters

HONG KONG -- Chinese banks' turnaround in profitability is faltering as the country's largest lenders get sucked into further support for ailing parts of the economy and struggling state-owned companies, despite a broad recovery from the coronavirus pandemic.

This year was expected to mark the start of a multiyear recovery at China's commercial banks, after their combined net profit fell 2.7% in 2020, the first decline in a decade.

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