Economy

Chinese banks see fewer bad loans as economy recovers from COVID-19

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FILE PHOTO: A man rides an electric bike past the China Banking and Insurance Regulatory Commission (CBIRC) building in Beijing, China February 14, 2019. Picture taken February 14, 2019. REUTERS/Stringer

BEIJING (Reuters) – Chinese banks saw the size of their bad loans shrinking at the end of last year, statistics from the country’s top banking and insurance watchdog showed on Tuesday, as businesses’ recovery from the pandemic gathered steam.

The outstanding bad loans of China’s commercial banks totalled 2.7 trillion yuan at the end of December, down by 133.6 billion yuan from the end of the third quarter, China’s Banking and Insurance Regulatory Commission (CBIRC) said.

The non-performing loan ration in the sector stood at 1.84% at year-end, compared to 1.96% at the end of September, according to a statement on the CBIRC website.

The banking sector achieved a net profit of 1.94 trillion yuan in the whole year of 2020, falling 2.7% year-on-year, it showed, with 5 trillion yuan put aside for bad loans.

Reporting by Zhang Yan; Editing by Gareth Jones

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