China has drafted rules banning banks from evading lending limits by structuring loans to other financial institutions so that they can be recorded as asset sales, two people with knowledge of the matter said.
China Construction Bank Corp.’s third-quarter profit rose 9.4 percent, matching analysts’ estimates for slower growth as bad loans increased and the nation’s second-largest lender paid more to attract deposits.
China’s top four banks posted their biggest increase in soured loans since at least 2010 as a five- year credit spree left companies with excess manufacturing capacity and slower profit growth amid a cooling economy.
Industrial & Commercial Bank of China Ltd., the world’s most profitable lender, posted the slowest earnings gain in more than four years as nonperforming loans increased while lending and fee income growth slowed.
Chinese companies are spending more than ever to service debt after their borrowing almost tripled over five years, prompting strategists to warn of rising default risk and a threat to economic growth.