Moody’s - China banks investments in loans increases systems risk

Ratings agency Moody’s latest report on China banks titled “Chinese banks' rising investments in loans & receivables increase system risks” says Chinese banks’ investments in loans increases system risk.

Key points

• Surge in investments in loans and receivables by Chinese banks while supportive of earnings and capital generation in the short term; raises asset quality, liquidity and interest rate risks in the long term.
• They see risks to Chinese banks' liquidity positions