How Stable Is The Chinese Banking System?

Photo: The collapse of a small regional bank could drag down the Chinese economy. (REUTERS: Thomas White/File)

Stephen Letts, ABC News Online: Baoshang Bank collapse threatens China's economy and may trigger central bank response

Up until a few weeks ago the Baoshang Bank's prospects seemed bright enough.

According to Baoshang's most recent regulatory filing, the smallish lender based in Inner-Mongolia, made a $600 million profit in 2017.

It had assets of around $90 billion, non-performing loans were modest — under 2 per cent — and its capital buffers would fit comfortably with the global demands of a Tier1 bank.

Then it collapsed.

That set off a series of events rarely, if ever, seen in Chinese banking.

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WNU Editor: It does not look stable according to the above story.

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