China Subprime Mortgage

[Warrior88 0]

China is quick to learn from the US about the Lehman Brother crisis. Starts looking at bank sheet loan.

2.3 trillions. Most home in China are vacant, About 51 percent of Shanghai apartments, 66 percent of Beijing flats and more than 70 percent of units in Hainan are vacant, according to the survey, based on counting the number of apartments observed to have no lights on at night.

If world 2nd giant sneeze, we may catch the virus

Shanghai (AFP) Aug 11, 2010

China's banking regulator has ordered lenders to put around 340 billion dollars in off-balance sheet loans back on their books amid fears of a possible explosion in bad debts, a report said Wednesday.

The watchdog also ordered them to stop using "informal securitisation" after banks sold or transferred 2.3 trillion yuan in loans to trust companies to evade strict regulatory requirements, the Financial Times said.

The loans have been repackaged into investment products and sold to investors -- a practice blamed for exacerbating the global financial crisis, the report said.

"We've learnt the lesson of the financial crisis and we realise we need to strengthen oversight over this phenomenon," an unnamed senior official at the China Banking Regulatory Commission was quoted as saying.

The regulator would not immediately comment when contacted by AFP.

China has sought to curb rampant bank lending this year after new loans nearly doubled to 9.6 trillion yuan in 2009, fuelling fears of a damaging bubble in the property sector and a possible surge of bad debts.

Authorities have set a loan target of 7.5 trillion yuan for this year and ordered banks to increase the amount of money they keep in reserve, effectively limiting the amount they can lend.

To get around these restrictions, banks are increasingly moving loans off their balance sheets through "informal securitisation", which Fitch Ratings said last month was masking the true extent of bank lending and bad debts exposure.

Chinese banks officially issued 4.6 trillion yuan (679 billion dollars) in new loans in the first half of this year, but the actual figure was probably closer to 5.9 trillion yuan if off-balance sheet loans are included, Fitch said.

At the end of the first half, Fitch estimated that more than 2.3 trillion yuan in outstanding loans was sitting off the balance sheets of Chinese banks in investment products -- a more than tenfold increase from the end of 2007.

Putting this money back on to the banks' books will strain capitalisation and loan-to-deposit ratios and could force some banks to raise capital, the Financial Times said.

The official Shanghai Securities News said the regulator wanted the loans back on the banks' books by the end of 2011.

[neubie 2]

acherly, many of the houses in PRC off their lights at night to reduce power consumption, else their powergrids will be overloaded...

[Warrior88 0]

Em..acherly quite true, just survey on the utility readings will give a slight insight of residency

[bepgof 20]

China is quick to learn from the US about the Lehman Brother crisis. Starts looking at bank sheet loan.

2.3 trillions. Most home in China are vacant, About 51 percent of Shanghai apartments, 66 percent of Beijing flats and more than 70 percent of units in Hainan are vacant, according to the survey, based on counting the number of apartments observed to have no lights on at night.

If world 2nd giant sneeze, we may catch the virus

Shanghai (AFP) Aug 11, 2010

China's banking regulator has ordered lenders to put around 340 billion dollars in off-balance sheet loans back on their books amid fears of a possible explosion in bad debts, a report said Wednesday.

The watchdog also ordered them to stop using "informal securitisation" after banks sold or transferred 2.3 trillion yuan in loans to trust companies to evade strict regulatory requirements, the Financial Times said.

The loans have been repackaged into investment products and sold to investors -- a practice blamed for exacerbating the global financial crisis, the report said.

"We've learnt the lesson of the financial crisis and we realise we need to strengthen oversight over this phenomenon," an unnamed senior official at the China Banking Regulatory Commission was quoted as saying.

The regulator would not immediately comment when contacted by AFP.

China has sought to curb rampant bank lending this year after new loans nearly doubled to 9.6 trillion yuan in 2009, fuelling fears of a damaging bubble in the property sector and a possible surge of bad debts.

Authorities have set a loan target of 7.5 trillion yuan for this year and ordered banks to increase the amount of money they keep in reserve, effectively limiting the amount they can lend.

To get around these restrictions, banks are increasingly moving loans off their balance sheets through "informal securitisation", which Fitch Ratings said last month was masking the true extent of bank lending and bad debts exposure.

Chinese banks officially issued 4.6 trillion yuan (679 billion dollars) in new loans in the first half of this year, but the actual figure was probably closer to 5.9 trillion yuan if off-balance sheet loans are included, Fitch said.

At the end of the first half, Fitch estimated that more than 2.3 trillion yuan in outstanding loans was sitting off the balance sheets of Chinese banks in investment products -- a more than tenfold increase from the end of 2007.

Putting this money back on to the banks' books will strain capitalisation and loan-to-deposit ratios and could force some banks to raise capital, the Financial Times said.

The official Shanghai Securities News said the regulator wanted the loans back on the banks' books by the end of 2011.

Actually not surprising, apply to some major cities only lah. Unlike Singaporeans so "mt", they don't understand what is "mobile population" . The daily number of ppl in/out shanghai = whole population of Singapore. That was why I said "wherever the hungry tigers go, nothing left". I squeeee/not Q, with them at airport with valid ticket & amber time. Domestic flight just "anyhow" sit. Sigh, cannot beat them must join them. Now #2 after usa.