BEIJING (Reuters) -China’s banking sector bad loan ratio stood at 1.71% at the end of 2022, down 0.09 percentage point from a year earlier, the Shanghai Securities News said on Friday, citing the sector’s regulator.
Outstanding non-performing loans stood at 3.8 trillion yuan ($563.45 billion) at the end of last year, the report said, while the financial institutions disposed of 3.1 trillion yuan in bad assets, including 2.7 trillion yuan in bad loans.
China’s financial regulators have stepped up efforts to rein in risks to lenders in response to a slowdown in the world’s second largest economy, which was last year reeling with strict COVID-19 curbs, a deepening property crisis and weak demand.
However, many analysts believe the actual levels of bad loans may be far higher than official data. Steps to cushion businesses from COVID-19 pressures, such as extending loan repayments, may have skewed the figures.
The media report cited the regulator China Banking and Insurance Regulatory Commission (CBIRC) as saying that it last year further improved the quality and efficiency of financial institutions to serve the real economy.
“In 2023, the CBIRC…will give priority to supporting the recovery and expansion of consumption, and will provide good financing guarantee for investment activities,” the media cited the regulator as saying.
Last year, China’s commercial banks made net profit of 2.3 trillion yuan, up 5.4% year-on-year, it said.
($1 = 6.7442 Chinese yuan renminbi)
(Reporting by Ziyi Tang and Ryan Woo, Editing by Raissa Kasolowsky and Arun Koyyur)
