China's property crisis has impacted the country's biggest banks, increasing non-performing loans.
Beijing is urging banks to boost financing for "white list" property developers to help the sector.
Despite the crisis, Chinese banks say they have sufficient buffers to manage risks.
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China's property crisis has hit the books of its biggest lenders, which are reporting an uptick in non-performing loans.
Non-performing loans at China's big four banks — Industrial and Commercial Bank of China, Bank of China, China Construction Bank, and Agricultural Bank of China — jumped 10.4% in 2023, from 1.117 trillion Chinese yuan, about $155 billion, in 2022 to 1.23 trillion yuan.
This is according to a Nikkei analysis based on the companies' earnings, which were released this week.
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The banks were all profitable last year, but their margins are being increasingly pressured by the fallout from China's real-estate debt crisis.
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Even so, Beijing is urging banks to boost financing for property developers featured on a "white list" of companies.
China's real-estate sector has been mired in crisis since the second half of 2021, when a liquidity crunch at Evergrande — once China's second-largest developer — came to light.
Despite the rise in bad loans, Chinese lenders said they had enough buffers to weather the storm and will control lending risks to property developers, per Nikkei.
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China's property crisis is bleeding into its banking sector, which is being asked to prop up developers. China's property crisis has impacted the country's biggest banks, increasing non-performing loans. Beijing is urging banks to boost financing for "white list" property developers to help the sector.
In December 2021, property giant Evergrande defaulted on its bonds and was later ordered to liquidate. Its collapse sparked a financial crisis that enveloped the entire housing market in China, with several companies defaulting and homes remaining uncompleted.
China's property downturn is eroding the balance sheets of the nation's largest state banks. China's protracted property downturn is eroding the balance sheets of the nation's largest state banks as their bad loans creep up.
The Chinese property sector crisis is a current financial crisis sparked by the 2021 default of Evergrande Group. Evergrande, and other Chinese property developers, experienced financial stress in the wake of overbuilding and subsequent new Chinese regulations on these companies' debt limits.
China's Property Crisis Is Upending Tens of Thousands of Lives. Default is all but official at one of China's largest developers. That's intensifying the pain for struggling homebuyers, workers and investors, just when the economy most needs a boost.
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