SHANGHAI -- Chinese banks' massive lending to the real estate sector looks increasingly likely to backfire on many as default fears mount -- and may ultimately make it harder for authorities to bail them out.
Aggregate lending by Chinese banks to developers came to 14.2 trillion yuan ($2.2 trillion) at the end of June, according to Moody's Investors Service. This accounts for 7.4% of total bank loans, Moody's says, and is equivalent to more than half of the 25.5 trillion yuan in net capital held by commercial banks in government data.
