IMF says China needs a way to wind down troubled banks

Fund also warns 'decreasing quality' of corporate debt after annual consulation

In its annual consultation with China, the IMF cites a need for comprehensive restructuring, in line with international best practices, to liquidate weak banks. © Reuters

CK TAN, Nikkei staff writer

January 8, 2021 22:10 JST

Updated on January 8, 2021 23:39 JST

SHANGHAI -- The International Monetary Fund on Friday said China should allow lenders overburdened by bad loans to be liquidated so economic growth can be sustained in the medium term.

In a report following its annual consultation with China, the Washington-based IMF acknowledged Beijing's swift response in containing the impact of COVID-19, which allowed for a fast economic recovery.