From Xinhua, Via China Economic Net:
Some experts have warned that China is likely to suffer a severe financial crisis in 20 years unless measures are taken, according to the Beijing-based newspaper Economic Reference.
The huge amount of non-performing loans of China’s major commercial banks increases the danger of panic bank withdrawals, the newspaper quoted Wu Jinglian, a renowned Chinese economist as saying.
Although China’s Big Four state-owned banks, the bedrock of the country’s financial system, have been doing their utmost to clear away bad loans and streamline their operation, their non-performing loan ratio still stood at an average of 15.6 percent by the end of last year, the China Banking Regulatory Commission (CBRC) reported.
Wu warned against the financial risks accumulated in the sluggish stock markets. Despite China’s rapid economic development, the Shanghai Composite Index, which covers yuan-denominated A shares and foreign-currency B shares, slumped to 1172.57 points on March 30, the lowest point since May 19, 1999.
