“#China: Bank of Communications reported that its property bad loan ratio jumped to 4.99% at the end of last year from 2.8% a year earlier. Industrial & Commercial Bank of China saw its bad loans from residential mortgages rise 9.6% to 27.8 billion yuan. We know that the property sector (as outlined in a 2021 report by Goldman Sachs) was valued at approximately $62 trillion and constitutes more than 60% of Chinese household wealth. We also know that Chinese banks are undercapitalized. Now, do the math. If these 2 banks are having issues, all Chinese banks likely have problems. How will Chinese Banks get recapitalized? Bail-out or Bail-In? With capital controls in place, I would not be surprised to see a bail-in followed by a sharp devaluation.”
Bank of Communications reported that its property bad loan ratio jumped to 4.99% at the end of last year from 2.8% a year earlier.
Industrial & Commercial Bank of China saw its bad loans from residential mortgages rise 9.6% to 27.8 billion yuan.
We know that the… pic.twitter.com/x00XeflHVC
— Michael Nicoletos (@mnicoletos) March 28, 2024
#recession … #GFC2 China #Property Bubble edition https://t.co/G1Yu5Up9mv pic.twitter.com/hszZjHYvjE
— Invariant Perspective (@InvariantPersp1) March 28, 2024